Positive working capital is when a company has more current assets than current liabilities, meaning that the company can fully cover its short-term liabilities as they come due in the next 12 months. Positive working capital is a sign of financial strength; however, having an excessive amount of working capital for a long time might indicate that the company […]

Sometimes a corporation decides to purchase its own stock in the market. A company might purchase its own outstanding stock for a number of possible reasons. It can be a strategic maneuver to prevent another company from acquiring a majority interest or preventing a hostile takeover. A purchase can also create demand for the stock, […]

However, it is important to consider the costs and benefits of listing before making a decision. Another situation that sometimes arises is that someone who loaned money to the business will agree to accept stock in repayment of the loan. In that case, no adjustment to the asset side of the balance sheet is necessary. […]

The net profit is the profit that remains after all the expenses are subtracted from the revenue. A company’s revenue is all the money it generates over an accounting period. Revenue and net sales both describe income for a company, but there are some important differences. It is the primary sales figure that analysts review […]

Full-Service Bookkeeping doesn’t include sending invoices, paying bills, or management of inventory, accounts receivable, or accounts payable. The service doesn’t include financial advisory services, tax advice, facilitating the filing of income or sales tax returns, creating or sending 1099s, or management of payroll. QuickBooks Online offers Full Service Payroll for an additional cost. Intuit Bookkeeping […]

The revenue that an organization earns is essential to the ongoing survival of the company and determines its ability to become profitable. It is an indicator of the organization’s ability to sell goods and services to customers. Accrued revenue is a concept that just about everyone can understand, because it mirrors how the vast majority of workers […]

However, it’s essential to note that tax authorities may have specific rules and guidelines for depreciation methods. Companies need to ensure they comply with these rules when choosing an accelerated depreciation method like the double declining balance method, or they may face penalties or adjustments. Depreciation is a fundamental concept in accounting, representing the allocation […]

The financial accounts of a company include the data needed to compute its BEP. The fixed expenses and the gross margin % are the first pieces of information needed. Variable costs are costs whose value varies per unit—cost changes due to the volume of production capacity that can change in response to market demand. Understanding […]

He is the sole author of all the materials on AccountingCoach.com. Think of retained earnings as savings, since it represents the total profits that have been saved and put aside (or “retained”) for future use. If you want to know more about accounting errors and how to spot them, we recommend reading Common https://www.bookstime.com/ Accounting […]

Photographers need to keep their receipts or invoices for every expense that they plan to deduct on their taxes. It’s best to also keep an electronic copy of expenses when possible. You can scan them into a PDF or just snap a photo of them and keep them in an electronic accountant for photographers folder. […]