The expense accounts are temporary accounts that reflect every expenditure the business makes on running its business, including, among other things, costs for supplies and advertising. The balance in this account is occasionally transferred to the retained profits account by way of the income summary account at the end of a financial year. It’s called…
Tax accountants might audit your business if the IRS notices tax incongruences, or forensic accountants if law enforcement agencies suspect financial wrongdoing. Managerial accountants, also known as management accountants, collect financial data, analyze it, compile it into reports and then present it to the company’s management. Unlike the previously mentioned financial statements, these reports are…
The role of consignee and consignor must be clarified to establish who is responsible for what. Without an established consignee, the carrier could be considered responsible for ownership of goods, including the handling customs duties, or the cargo could be abandoned at the border. It is important to understand the differences between consignor vs. consignee….
In practice, most modern manufacturers use MRP software with perpetual inventory systems that calculate WIP automatically and continuously. The cost of goods manufactured (COGM) is one of the inputs necessary to calculate a company’s end-of-period work in progress (WIP) inventory, which is the value of inventory currently in a production process stage. COGM stands for…
In accounting courses, the cash account is usually first explained as part of the ledger system. Small businesses face closure yearly, with taxes compounding the burden. Learn how Offer in Compromise can relieve tax debt stress and revive your business. In modern times cash has consisted of coins, whose metallic value is negligible, or paper. Cash has…
In accounting courses, the cash account is usually first explained as part of the ledger system. Small businesses face closure yearly, with taxes compounding the burden. Learn how Offer in Compromise can relieve tax debt stress and revive your business. In modern times cash has consisted of coins, whose metallic value is negligible, or paper. Cash has…
Beyond these core components, features such as the issuer, call and put options, credit rating, covenants, and marketability also play important roles in a bond’s valuation. Similarly, when interest rates decrease, and the YTM decrease, the bond price will increase. We have written this article to help you understand what a bond price is and…
Thus, if you know the bond’s current price and all of the future cash flows, you can find the YTM, or the return rate that the bond buyer is receiving on the funds loaned to the bond issuer. As mentioned, Excel spreadsheets are as easy and accurate as a financial calculator for determining bond rates,…
The IRS has set specific rules for which type of method a company can use and when to make changes to the inventory cost method. With the same selling price of bath soap, this helps your company increase your margin without jeopardizing quality. Inventory costs may be a little more complicated to calculate depending on…
It is extremely important for businesses to do due diligence and need analysis before buying a major fixed asset. This is because fixed assets are not only high-value expenses but also because they are difficult to reverse. CapEx refers to the funds that a company invests in long-term assets such as property, plant, and equipment…