Insurance often required by states and paid for by the employer to compensate workers who were injured on the job. For example, rates are higher for operators of machinery and are lower for office employees. If the net realizable value of the inventory is less than the actual cost of the inventory, it is often […]

Where the depreciation rate is a multiple of the straight-line rate, typically 2 or 3. Where salvage value is the estimated value of the asset at the end of its useful life. Over the life of the mining project, they estimate that they can gather 5,500 pounds of quartz. What is the difference between depreciation […]

The first way to calculate shareholders equity is to use the Accounting Equation or Balance Sheet Equation. You can calculate shareholders’ equity using the basic Accounting Equation or the Investor’s Equation. The most effective approach will depend on the company’s unique financial situation, industry dynamics, growth stage, and strategic objectives. A balanced, multifaceted strategy typically […]

Thus, while the company’s assets grow, the increase in liabilities must be carefully managed to ensure a healthy balance sheet. Whenever your supplier provides goods or services on credit to your business, there are accounts payable outstanding on your balance sheet. Meaning the accounts payable account gets credited as there is an increase in the […]

Proficiency in accounting software such as SAP and Excel are essential for accountants. Whether you are auditing, filing tax returns or doing a company’s payroll, proficiency in accounting software is a must have. As technology is evolving accountants must adapt by developing skills in data analysis and data visualisation. This includes evaluating business performance, maximising […]

This method often relies on physical counts and manual record-keeping, which can be less costly to implement for smaller businesses. However, it may lead to stockouts or overstock situations due to the lag in data updates, which can affect sales and storage costs. Perpetual inventory systems utilize computerized methods for real-time tracking, offering detailed and […]

We’re rapidly growing across the state of Texas and now offer local services in Austin, Dallas/Fort Worth, San Antonio, and Houston. We also offer remote services for those outside of these metropolitan areas. As a business owner, you have more important things to do than to keep your own books. Our primary goal is the […]

Based on the above information, you must calculate the firm’s closing cash balance. The world of finance is full of metrics and measurements, most of which have complex formulas and incredibly specific use cases. Many businesses experience seasonal fluctuations, with peak periods of high demand… A company reports $120,000 in net income, with $30,000 in […]

Upon issuance, common stock is recorded at par value with any amount received above that figure reported in an account such as capital in excess of par value. In that situation, the Maine Company should recognize the land at its own fair value of $125,000 with an accompanying $5,000 increase in the capital in excess […]

Understanding how to account for obsolete inventory in accordance with GAAP can help you make sure that your financial statements are properly presented and your books are in order. Businesses should periodically assess their product portfolio to identify items that are nearing the end of their lifecycle. This can involve discontinuing underperforming products, introducing new […]