Accounting

Audited financial statements help the board of director have more confidence in the organization’s finances because they are based on an analysis by an objective third-party. 37It is not appropriate for the auditor to use phrases such as “with the foregoing explanation” in the opinion paragraph when an emphasis paragraph is included in the auditor’s report. Other accounting firms individually contributing less than 5% of total audit hours— the number of other accounting […]

While using this method, you need to post entries for the transactions allocated to the current period. If 20% of the work is completed in the current accounting period, the business recognizes only 20% of the profit in the current year.

What does ASC 326 Replace?

ASC 326 replaces the incurred loss methodology with a framework that requires recognition of financial assets as the amount expected to be collected through the measurement of expected credit losses.

Once upon a time, contracto […]

The cards should also define the difference between the margin and markup terms, and show examples of how margin and markup calculations are derived. Markup is the amount by which the cost of a product is increased in order to derive the selling price. To use the preceding example, a markup of $30 from the $70 cost yields the $100 price. Or, stated as a percentage, the markup percentage is 42.9% .

You can also take steps to attract business by doing more than just offering a low price. For ins […]

As frustrating as it might be, you may not receive payments from customers. You will need to create your second entry a little differently than when you receive payments. Credit accounts receivable to reduce the amount owed by your customer. If anyone ever sends you a physical invoice, scan it and make sure it’s with all of your other documents. The better you are at keeping all of your accounts payable documents in one place, the less likely you are to forget about one of them. Notes Rec […]

The book value of common stock is rarely identical to the market value. If the market value of asset is substantially different from their respective book values, then the book value per share measure loses most of its relevance. Companies fund their capital purchases with equity and borrowed capital. The equity capital/stockholders’ equity can also be viewed as a company’s net assets .
Finally, the number of shares outstanding refers to shares that are owned only by outside investo […]

A note receivable is often formed when a business, usually a bank, makes a loan to another business. A note will often be for less than a year, but some can be well in excess of this time frame. Recognize notes receivable income as interest income on the income statement. Thus, when payment is made the amounts effect the balance sheet as well as the income statement. You should classify a note receivable in the balance sheet as a current asset if it is due within 12 months or as non-current (i. […]