What is CFD, Accrual Journal entries, Journal entry for purchase of stock and it's impact on balance sheet

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Accepted Answer

CFD is a financial derivative, accrual journal entries record expenses/revenues, journal entry for stock purchase affects balance sheet.

CFD stands for Contract for Difference, a financial derivative that allows investors to speculate on the price movements of an underlying asset without owning it.
Accrual journal entries are used to record expenses or revenues that have been incurred but not yet paid or received.
A journal entry for the purchase of stock would typically involve debiting the Stock or Investments account and crediting the Cash or Accounts Payable account.
The impact on the balance sheet would depend on the specific transaction and the financial position of the company.
For example, if a company purchases stock using cash, the balance sheet would show an increase in the Stock or Investments asset account and a decrease in the Cash asset account.

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