Bookkeeping

Recording bad debts or doubtful debts is necessary to depict a business’s true and fair financial position. Bad debt expense also helps companies identify which customers default on payments more often than others. For example, in one accounting period, a company can experience large increases in their receivables account. Non-payment […]

Another example of a contra asset account is the accumulated depreciation account which reduces the reporting value of capital assets. Allowance for obsolete inventory or obsolete inventory reserve are also examples of contra asset accounts. Sales returns is a contra revenue account as the figure is a negative amount net […]

Net sales do not account for cost of goods sold, general expenses, and administrative expenses which are analyzed with different effects on income statement margins. A write-off is recorded before you sell the goods to customers. It is an expense that lowers your asset value on account of any losses […]

The sales tax did not begin to take effect until the Great Depression. State governments had trouble finding ways to collect revenue effectively. Of the many methods tried, the sales tax was the most effective because the economic policy of the 1930s focused on selling goods. It follows that in […]

By subtracting what inventory was leftover at the end of the period, you calculate the total cost of the goods you sold of that available inventory. Service-based compare economic cost and accounting cost businesses might refer to cost of goods sold as cost of sales or cost of revenues. LIFO […]

For example, for a deposit at a stated rate of 10% compounded monthly, the effective annual interest rate would be 10.47%. Banks will advertise the effective annual interest rate of 10.47% rather than the stated interest rate of 10%. Real interest rates are crucial for making informed financial decisions, especially […]

The dotted red box in the shareholders’ equity section on the balance sheet is where the retained earnings line item is recorded. In the final step of building the roll-forward schedule, the issuance of dividends to equity shareholders is subtracted to arrive at the current period’s retained earnings balance (i.e., […]

If inventory went down during the year, it means that inventory was sold and cash was received. As of Feb. 27, 2019, the two had current liabilities of $77.5 billion and $17.6 billion, respectively. Over the trailing 12 months, Walmart had generated $27.8 billion in operating cash flow, while Target […]

So, you should produce those goods that generate a high contribution margin. As a result, a high contribution margin would help you in covering the fixed costs of your business. Thus, the total variable cost of producing 1 packet of whole wheat bread is as follows. Contribution margin calculation is […]

These numbers have to match, or it means you might have lost money somewhere. It’s always a good idea to have an accounting system to help track real estate investors and expenses. While accounting might not be the first skill you think of when it comes to real estate https://rnbxclusive.org/simple-ideas-and-home-business-for-beginners/ […]