Debtor vs Creditor

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Creditors are the complete opposite of debtors. They can be institutions, businesses, or individuals who lend money to debtors. Creditors can be people or entities, just like debtors. They can also be companies that supply goods. When a company provides supplies or services and agrees to be paid at a later time, it becomes a

What is Creditor?

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A creditor is someone who lends money to another person or entity through a loan agreement. Creditors can be categorized as personal or real. Lending money to friends, family, or a business that offers immediate supplies or services to a company or individual, but allows for a payment delay, can classify someone as a personal

What Is Debtor?

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A debtor is someone who owes money, either as a company or an individual. If the debt is in the form of a loan from a financial institution, the debtor is called a borrower. However, if the debt is in the form of securities like bonds, the debtor is referred to as an issuer. A

How Bankruptcy Works

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Bankruptcy is a legal process that begins when an individual or company is unable to repay their debts or financial obligations. It provides a new beginning for those who are unable to afford their expenses. The process of bankruptcy starts when the debtor files a petition, which is usually done by the debtor themselves, or

What is a Restructuring Process?

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Companies undergo restructuring to make significant changes to their financial and operational aspects, especially when they are experiencing financial difficulties. It involves making major modifications to debt, operations, or structure to minimize financial losses and enhance the company’s performance. What is a Restructuring Process? When a company is struggling to make debt payments, it will

What is Non-Operating Expense?

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Non-operating expenses are costs that are not directly related to the main activities of a business. Interest charges and losses from selling assets are examples of non-operating expenses. Accountants may exclude non-operating expenses and revenues to better understand how well the core business is performing, without the influence of financing and other factors. – What

What is Operating Expense?

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An operating expense is a cost that a business has from its regular operations. It is often called OpEx and includes expenses like rent, equipment, inventory costs, marketing, payroll, insurance, step costs, and funds for research and development. Learn more about it Operating expenses refer to the expenses incurred by a company during its regular

What is Expense?

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Expenses are the expenses that a company has to pay in order to make money. It is basically the money you need to spend to get something. As the saying goes, “you have to spend money to make money.” – What is Expense? Businesses often have various expenses that they need to pay for. These

What is Tangible Asset?

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A tangible asset is an asset that has a definite monetary value and usually exists in a physical form. Tangible assets can always be exchanged for some monetary value, although the liquidity of different markets may differ. Tangible assets are different from intangible assets, which have a theoretical value rather than a value based on

What is Liability?

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A liability is an obligation that a person or company has, typically involving a certain amount of money. Liabilities are resolved gradually by exchanging economic benefits such as money, goods, or services. Liabilities, which are listed on the right side of the balance sheet, consist of loans, accounts payable, mortgages, deferred revenues, bonds, warranties, and