Accounting

Interest is considered to be payable irrespective of the status of the underlying debt as short-term debt or long-term debt. Short-term debt is payable within one year, and long-term debt is payable in more than one year.

Current liabilities are typically paid off using current assets like cash or cash equivalents. A business must have enough current assets to settle the current liabilities within their due dates. An adjusting journal entry occurs at the end of a reporting period to record any […]

You should charge sales and administrative costs to expense in the period incurred; do notassign them to inventory, since these items are not related to goods produced, but rather to the period in which they were incurred. Cost of goods sold is defined as the direct costs attributable to the production of the goods sold in a company. Keep in mind, companies using the cash method may not need to recognize some of their expenses as immediately with variable costing since they are not tied to reve […]

There are several different types of expenses that a business can incur. Understanding these expense types and how they work can help your company better budget its money and plan for unforeseeable incidents that may require additional funds. In this article, we explore what business expenses are, how to record them and list the most common types of expenses on your business financial statements.

However, these payments do not have a lasting benefit for the business.
Even if something qualifie […]

Does it mean taxpayers do not have to comply with the tax laws if they do not feel like it? How can it be a federal crime to not file or pay taxes if compliance is voluntary?

A majority of audits are triggered by suspicious items included or omitted from tax returns. Other tax audits are generated because taxpayers who should file tax returns fail to do so or file so-called frivolous returns.
Explaining The Trump Tax Reform Plan
The above article is intended to provide generalized financial in […]

The bottom line result is that you have a metric that somewhat shows you accounting profits but at the same time adjusts for one major non-cash item (D&A), which gets you a bit closer to actual cash. So, it tries to get you the best of both worlds (the flip-side is it retains the problems of both as well).

A cash flow Statement contains information on how much cash a company generated and used during a given period. Net Present Value is the value of all future cash flows over the entire l […]

On the flip side, in regions with increased COVID-19 infections, consumers were eager to pay for offerings such as extra leg room. Organic sales are revenues generated from the firm’s existing operations as opposed to acquired operations. Below is a table showing the product sales as reported by the company in its 10Q earnings report for the quarter ending on December 28, 2019. “Ancillary revenues”, therefore, are revenues that are of secondary importance to the operation of a […]