About Intermediate Accounting

Intermediate accounting is another hard accounting course that goes a bit deeper into accounting than basic accounting.  That’s why it’s known to be a bit more complex than normal accounting.  It has four main branches;

·         The time value of cash: It deals with long term bonds and deferred annuities which are time value matters.  Annuities are nothing but a payment voucher that you either receive or make over a period of time.  Deferred annuities are flexible and wait for acceptance of the receiver.  In other words the receiver has the freedom to accept the payment in his own terms.

·         Accounting for retail inventory:  This is the major subject in financial accounting.  It deals with the effect of inventory cost over the income statements and assumption of inventory cost-flow.  In simple terms, it’s basically accounting for cost control of retail inventory.   A cost ratio is used in retail inventory method to convert the final inventory value at cost of retail. 

·         Research and Development Expenses (R&D): This topic hardly gives importance on the financial accounting subject.  A fine example is that of a pharmaceutical company when it develops an indigenous drug.  A lot of R&D is done before the drug is tested several times and finally launched.  But, Intermediate Accounting shows the way to handle this expense as a cost.

·         Accounting for income taxes: Accounting textbooks have very little discussion on this one subject of income taxes.  As even the academic experts don’t go to paying taxes for hard earned money.  But not with intermediate accounting, it discusses calculation of taxes in detail.