It also includes administrative expenses like office supplies/paper clips/staplers/etc. A balance sheet is one of the financial statements that gives a view of the company’s financial position, while assets are the resources a company owns. The consulting firm was also able to re-negotiate the manufacturing company’s contracts with poor-performing suppliers. The Ascent is a Motley...Read More
Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team. Janet Berry-Johnson, CPA, is a freelance writer with over a decade of experience working on both the tax and audit sides of an accounting firm. She’s passionate about helping people make sense of complicated...Read More
When Robert Johnson Pvt Ltd makes payment to its supplier, the accounts payable account gets debited. This is because Robert Johnson’s current liability reduces by $200,000. The offsetting credit entry for such a transaction is made to the cash account. Your company is paying slowly to its suppliers if its accounts payable turnover ratio falls...Read More
One such practice is moving from an insured health plan to a partially or fully self-insured one. This article outlines that general principles of self-funding for small and midsize employers, addresses potential challenges employers might face, and provides tips to help CFOs assess self-funding. The COVID-19 pandemic has presented insurance companies with several challenges, such as...Read More
Salaries expense are payments to employees that are paid annual salaries. Rent expense is a payment to rent assets like an office, Accounting Advice for Startups cars, or equipment. Cost of sales, or cost of goods sold, is the cost of providing goods and services to customers. Once the recording of transactions, invoices and other...Read More
Examples can include labor hours incurred, labor costs paid, amounts of materials used in production, units produced, or any other activity that has a cause-and-effect relationship with incurred costs. Sales of each product have been strong, and the total gross profit for each product is shown in Figure 6.7. Using the Solo product as an...Read More
Such an error will not show up in T account systems as it does not affect the way the books balance. Another error is the incorrect recording of the transaction on the wrong side of the T or mistyping the numbers. This can be easily corrected if the accountant checks the books after every entry....Read More
Understanding how to calculate the formula for sales tax doesn’t take long, and you can memorize it for those times you don’t have a calculator handy. The following is a look at calculating and collecting the right amount of sales tax for your physical and online sales. A recent Supreme Court ruling stated that you...Read More
While it’s not necessary for you to know every in and out of GAAP unless you’re an accountant, you’re doing well to at least familiarize yourself with the basic principles. Gaining at least a conceptual understanding of the motivations behind GAAP will help you keep the financial reporting side of your business running smoothly. Accounting...Read More
A direct cash flow statement is a simple representation of cash movement. The layout of the direct cash flow method makes it easy for the reader to understand how cash comes into and out of the business. Unsure of the difference between direct and indirect cash flow reporting? Luckily, when using a dynamic and intuitive...Read More
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