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Sales incentives, future product returns and product warranties are classified as current liabilities. Unlike accounts payable where both payee and amount are known, three of them...
Numerous costs and expense are incurred in the operation (leasing) of a property. Depending on the lease agreement, some of these costs/expenses can be recovered from...
One of the primary tasks of the accountant during the period-end closing process is the calculation of expense accruals, of which there are potentially a great...
Just few hours after the “6 Possible Strategies to Invest Idle Funds” got published, from numerous emails I received, I knew many of you, accountants, have...
Following on my previous post [Journal Entries Most Used by Accountants], here are other journal entries most used by accountants, either they‘re performed on daily, weekly, monthly...
This post contains a list of the journal entries that most used by accountant and is likely to deal with. There are a plethora of possible transactions...
It is often accountants are called upon to convert cash basis accounting records to the accrual basis. This post describes how to convert cash basis accounting record...
It is very common for companies to invest their idle cash in a variety of investments. These temporary investments may be in a form of marketable...
Most companies still use a physical inventory system that only reconciles inventory to actual physical counts at the end of the fiscal year. This system is...
Businesses must expect to sustain some losses from uncollectible accounts and should therefore show on the balance sheet the net amount of accounts receivable, the amount...
Asset disposal accounts are like miniature profit & loss accounts: they are final accounts, and not going on any further. Once written up, with their one...
In some industries it is common practice for customers to have the right to return a product to the seller for a credit or refund. However,...
Disposition of under-applied or over-applied overhead depends on the significance of the amount involved. If the amount is immaterial, it is closed to Cost of Goods...
Interim reports may be issued periodically, such as quarterly or monthly. Complete financial statements or summarized data may be provided, but interim financial statements do not...
Foreign currency transactions are denominated in a currency other than the company’s functional currency. Foreign currency transactions may result in receivables or payables fixed in the...
Accounting records are kept on the accrual basis, except in the case of very small businesses. To accrue means to collect or accumulate. This means that...
Property and Liquidating Dividends are another two items which are also included on the “Retained Earning” Accounts. On this post I am going to give some...
Retained earnings are created for the most part by the earnings of the corporation. These earnings (referred to as net income) are closed into the retained...