Category: Bookkeeping

The double-entry practice ensures that the accounting equation always remains balanced, meaning that the left side value of the equation will always match the right side value. Essentially, the representation equates all uses of capital (assets) to all sources of capital, where debt capital leads to liabilities and equity capital leads to shareholders’ equity. This… Continue reading Accounting equation Wikipedia

The simplest way to understand revenue vs income is by understanding the total summation of your expenses between each term. Effectively managing costs against revenues will determine whether a company will have positive earnings (a profit) or a loss. A company’s sales indicate the performance of its core business operations, while its revenue may be… Continue reading Revenue vs Income Difference, Example, Statement

Teams in England, in particular, have issued debentures to help fund construction, and the holders receive tickets to games or part ownership of the team. Every once in a while, a company will go out of business, and its assets will be liquidated. In this case, there is usually an order to which lenders get… Continue reading What Is a Debenture, and How Does It Work?

This helps businesses understand their current financial health and make better business decisions. Additionally, having an updated set of policies helps business owners make strategic decisions related to pricing, product sales, and operations. Regularly reviewing the bookkeeping policies ensures that any changes or adjustments can be made quickly in order to best meet the needs… Continue reading Bookkeeping for Etsy Sellers An Ultimate Guide

Foreigners are required to engage the services of an approved Corporate Service Provider (CSP), such as our company, to register a business in Singapore. Singaporeans are also strongly advised to utilize the services of a CSP to facilitate the registration process and ensure ongoing compliance. The application fee for sole proprietorships and partnerships, LP and… Continue reading Before You Start

This substitutes the creation of cash account, bank account, discount received and discount allowed in the ledger. A cash book is a financial journal that contains all cash receipts and disbursements, including bank deposits and withdrawals. This is the main area where businesses record any and all cash-related information. What is the method of posting… Continue reading Cash Book Examples Single & Double Column Cash Book Entry Example

And for self-employed attorneys or accountants, FreshBooks includes a retainer feature that makes it easy to bill your clients a retainer fee. Your business tax amount is determined by the net income on the Schedule C you complete each year. That Schedule C income is included in your personal 1040 tax return and is taxed… Continue reading Sole Proprietorship: What It Is, Pros & Cons, Examples, Differences From an LLC

Some industries for example retail, have typically very high current ratios while others, such as service firms, have relatively low current ratios. As the assets and liabilities are listed in the descending order of liquidity, current assets would appear above non-current assets. Current liabilities are obligations that require settlement within the normal operating cycle or… Continue reading What Is the Current Ratio? Formula and Definition

That said, low turnover ratios suggest lackluster demand from customers and the build-up of excess inventory. It implies that Walmart can more efficiently sell the inventory it buys. In addition, it may show https://simple-accounting.org/ that Walmart is not overspending on inventory purchases and is not incurring high storage and holding costs compared to Target. Companies… Continue reading Inventory Turnover How to Calculate Inventory Turns

This cip accounting creates unique challenges for financial planning, cost control, performance reporting, and informed decision-making. The balance sheet must show the true picture of the company’s financial health. When the construction under progress is recorded proportionally in every accounting period, it maintains the financial position’s transparency. These changes must be carefully documented and approved… Continue reading What is Construction Work-in-Progress?