Category: Bookkeeping

Current assets are generally reported on the balance sheet at their current or market price. Accounts payable accounts for financialobligations owed to suppliers after purchasing products or serviceson credit. An open credit line is a borrowingagreement for an amount of money, supplies, or inventory. Theoption to borrow from the lender can be exercised at any […]

Houghton College also provides opportunities for learners to create on-campus businesses and consult other student business owners. Evaluate their qualifications, experience, specialized services, and references to find a consultant what services do accountants provide compatible with your business. Businesses can leverage the consultant’s expertise to improve their financial management and ultimately achieve their business goals […]

Clear can also help you in getting your business registered for Goods & Services Tax Law. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. How Much […]

The investor needs to have at least a 10% margin of safety before trading with the GARP approach. In budgeting, the margin of safety is the total change between the sales output and the estimated sales decline before the company becomes redundant. It alerts the management against the risk of a loss that is about […]

A provision is recorded in a liability account, which is typically classified on the balance sheet as a current liability. The accounting staff should regularly review the status of all recognized provisions, to see if they should be adjusted. In American English, the word provision is used as a synonym for “expense”, especially when it […]

Contingency planning is a very important function of the accounting department and financial reporting procedure. And provisions are the essence of contingency planning that help the entities and individuals estimate an expense or loss in anticipation. The IAS 12 of International Financial Reporting Standards defines deferred tax payments as the future expense concerning the Taxable […]

The conversion should normally provide results comparable to those that would have occurred if the business had completed operations using only one currency. Translation losses from the devaluation of foreign currency are not reported with cash and cash equivalents. These losses are reported in the financial reporting account called “accumulated other comprehensive income.” However, if […]

On the other hand, in this example, Tyson Fresh Meats, Inc. has combined cash and cash equivalents in a single item. Working capital is important for funding a business in the short term (12 months or less) and can be used to help finance inventory, operating expenses, and capital purchases. In practice, the cash and cash […]

Let’s consider the following example to better understand abnormal balances. Each account can be represented visually by splitting the account into left and right sides as shown. This graphic representation of a general ledger account is known as a T-account. The concept of the T-account was briefly mentioned in Introduction to Financial Statements and will […]

To reduce the amount of disclosure, it is customary to only disclose information about events that are likely to have a material impact on the entity’s financial position or financial results. In fact, the full disclosure concept is not usually followed for internally-generated financial statements, where management may only want to read the “bare bones” […]