ADP RUN articles

On the balance sheet, the net liability for the bonds payable will be reported as $980,000 ($1,000,000 – $20,000), reflecting the impact of the discount on bonds payable. However, that $1.4 billion is used to reduce the balance of gross accounts receivable. Therefore, contra accounts, though they represent a positive amount, are used to net reduce a gross amount. For this reason, contra accounts are primarily seen as having negative balances because they are used to reduce the balance of anoth […]

For example, if a piece of heavy machinery is purchased for $10,000, that $10,000 figure is maintained on the general ledger even as the asset’s depreciation is recorded separately. On the income statement, the net cost of goods sold will be reported as $98,000 ($100,000 – $2,000), reflecting the impact of the purchase discount. The purpose of the Owner’s Withdrawal account is to track the amounts taken out of the business without impacting the balance of the original equity accoun […]

Contra Asset Account – A contra asset account is an asset that carries a credit balance and is used to decrease the balance of another asset on the balance. Whereas assets normally have positive debit balances, contra assets, though still reported along with other assets, have an opposite type of natural balance. As you saw in the example, contra accounts can be an important part of your financial statement analysis, but they are hard to find. Companies bury them in the footnotes and often don […]

While the basic bookkeeping principles may apply in both cases, certain seemingly small details make significant differences in how a nonprofit’s finances are done. Many accounting software bookkeeping for nonprofits programs allow you to generate financial statements automatically, such as a statement of financial position. This reduces the possibility of errors and guarantees reliability and accuracy.
It’s important to note that bookkeepers are not certified public accountants (CP […]

They are also relatively easy to update on a regular basis, which makes them more flexible than traditional annual budgets. Another concern is that the period of this budget may not correspond to a company’s fiscal year. Creating and maintaining a rolling budget requires input and collaboration from key organizational stakeholders, including department heads, finance teams, and executives. This will help ensure that the budget is comprehensive and reflects the needs and priorities of the […]

Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years. Read our latest news, features and press releases and see our calendar of events, meetings, conferences, webinars and workshops. Our Standards are developed by our two standard-setting boards, the International Accounting Standards Board (IASB) and International Sustainability Standards Board (ISSB).

Even if it is probable that the plaintiff will win the case and rec […]