This is a form of cash basis accounting and is most commonly found in installment sales. The revenue recognition principle is a key component of accrual-basis accounting. This accounting method recognizes the revenue once it is considered earned, unl... Read more
The amount of the credit depends on your filing status and adjusted gross income. For the 2021 tax year, if your filing status is single, you may be eligible if your adjusted gross income is $33,000 or less. If you are married and are filing jointly,... Read more
Most investors may not want to put their money into a company that isn't financially sound. If a company has a low-interest coverage ratio, there's a greater chance the company won't be able to service its debt, putting it at risk of bankruptcy. In o... Read more
They play a vital part of the procure to pay cycle in an organisation's supply chain management. With paper-based processes and systems, constant problems block and tackle the chances of accounting and the accounts payable department becoming efficie... Read more
The cost for shipping and taxes will appear as a loss on your Income Statement or Profit and Loss report. If you’re in the UK, you’ll pay VAT, but you can reclaim it later. Purchases of items for resale in the USA are exempt from Sales Ta... Read more
There are two methods of producing a statement of cash flows, the direct method, and the indirect method. From this CFS, we can see that the net cash flow for the 2017 fiscal year was $1,522,000. The bulk of the positive cash flow stems from cash ear... Read more
Instructions from the IRS on when employers must deposit most withheld federal employment taxes. Investopedia requires writers to use primary sources to support their work.... Read more
The notes may also provide information on underlying issues relating to the overall financial health of the company. The auditor bases his audit opinion on the financial statement numbers, as well as the notes to the financial statements. Prospective... Read more
Accountants must use their judgment to record transactions that require estimation. The number of years that equipment will remain productive and the portion of accounts receivable that will never be paid are examples of items that require estimation... Read more
NI flows through the balanced sheet through retained earnings, and through the cash flow in the indirect method. If both net profit and retained earnings are substantial, it’s time to invest in growing your business, perhaps with new equipment ... Read more
