The Theory of Constraints is a methodology for identifying the most important limiting factor that stands in the way of achieving a goal and then systematically improving that constraint until it is no longer the limiting factor. In a manufacturing business, the restraint can be referred to as a bottleneck. The Theory of Constraints uses… Read More


Throughput accounting is a principle-based and simplified version of management accounting. It provides management with decision support information to improve the enterprise’s profitability and it is relatively new in management accounting. Throughput accounting uses an approach that identifies factors that limits an organization from reaching its goal. Then it focuses on simple but effective measures… Read More


What is a statement of retained earnings? The statement of retained earnings is the second financial statement that must be prepared. It is prepared right after the income statement and before the balance sheet. In the United States, it is required by the Generally Accepted Accounting Principles whenever any comparative balance sheets and income statements… Read More