Accounting

If tax credits are available, it would reduce the taxes deducted and increase the after-tax income. While the calculation for after-tax income seems quite simple, there are many types of taxes that can be deducted. Normally, taxes deducted include federal, provincial, and state taxes. After-tax income calculations can also deduct withholding taxes, which are taxes that are withheld from an individual’s wages and paid directly to the government. Pay stubs generally show how an employee&rsq […]

Contributed surplus is a common item on the asset side of the balance sheet that helps differentiate different types of income. Contributed surplus is an account in the shareholders’ equityStockholders EquityStockholders Equity is an account on a company’s balance sheet that consists of share capital plus section of the balance sheet that reflects excess amounts collected from the issuance of shares above …

Capital surplus is not the same as retained earnings, which is the ag […]

Impairment of assets is the diminishing in quality, strength amount, or value of an asset. An impairment in accounting is a permanent reduction in the value of an asset to less than its carrying value.

Private companies in the US may elect to expense a portion of the goodwill periodically on a straight-line basis over a ten-year period or less, reducing the asset’s recorded value. An impairment cost must be included under expenses when the book value of an asset exceeds the recoverable a […]

However, the impairment loss cannot reduce the carrying amount of an asset below its fair value. The amount of an impairment loss is the difference between an asset’s carrying amount and its fair value. Once you recognize an impairment loss, this reduces the carrying amount of the asset, so you may need to alter the amount of periodic depreciation being charged against the asset to adjust for this lower carrying amount. After an asset have been revalued, the asset’s depreciation exp […]

Entities will typically have three categories of expenses which are broken down by direct costs, indirect costs, and interest on the income statement. Business expenses are costs incurred in the ordinary course of business. On the income statement, business expenses are subtracted from revenue to arrive at a company’s taxable net income. The selection of materials to support reconstruction almost always impacts local markets, although there are a number of factors that determine whether t […]

In many cases, this item will be listed under “Other Current Liabilities” if it isn’t lumped in with them. Adding the short-term and long-term liabilities together helps you find everything that is owed. Our Ebook covers all the ins and outs of small business loans to help you get funded as soon as possible. Benilyn Formoso-Suralta is a staff writer at Fit Small Business focusing on finance, accounting, and Small Business Loans. She brings with her 12 years of experience as a […]