Accounting

This article provides more details and helps you calculate these ratios. As your business grows and you take on more debt, it becomes even more important to understand the difference between current and long-term liabilities in order to ensure that they’re recorded properly. When using accrual accounting, you’ll likely run into times when you need to record accrued expenses.
The only type of liabilities that many small businesses have on their balance sheet in the beginning are acco […]

The Receivables Aging report is a tool that lists all unpaid customer balances by pre-defined date ranges . It shows the relationship between open invoices and their due dates.

What is the aging of accounts receivable method?

What is the Aging Method? The aging method is used to estimate the amount of uncollectible accounts receivable. The technique is to sort receivables into time buckets (usually of 30 days each) and assign a progressively higher percentage of expected defaults to each t […]

Subtract the depreciation figured in from the section 179 deduction you claimed. Generally, the rules that apply to a partnership and its partners also apply to an S corporation and its shareholders.

The entire interest expense of $400,000 is fully deductible in 2019.
A corporation and a partnership if the same persons own both of the following.
The following table shows where you can get more detailed information when depreciating certain types of property.
Type of Vehicle – The vehicle […]

If you would like a copy of the lease calculation and linked journal entries in Excel, please reach out to. Bargain PurchaseBargain purchase happens when a company acquires another company at a price less than the fair market value of its assets. What it has lost out to is the ownership rights, which at this moment of time is not the biggest issue that management is concerned about.

As stated above, the lessee may transfer the amount in the Leasehold account to Prepaid Rent at the beginning of […]

In this article, we explain what gross profit margin is, how to calculate it and why it’s important. A company determines its net profit by taking gross profit and subtracting its operating and non-operating. Net profit margin is then calculated by dividing the net profit by sales revenue. Net sales revenue is defined as the amount of money generated from selling goods and/or services to customers, after subtracting discounts, allowances and returns. ABC International has revenues of $1,0 […]

This process has many names, but one common name and approach is to conduct FMEA studies. This is part of the on-going process you need to execute to predict future warranty claims. Expense Journal EntriesExpense Journal entries are crucial accounting entries that record the entity’s expenditures.

Where is warranty expense on the income statement?

Revenues from extended warranty contracts are reported as “Revenue” in our income statement. We do not separately track warran […]