Business owners are often at crossroads when they want to decide the kind of business entity they want to establish. They are faced with several different options, and they primarily choose that on the basis of what suits them better amidst the several different options that they have. In this regard, corporations tend to be …
Advantages and Disadvantages of Corporation – All you need to know Read More »
What are customer advances? Customer advances can be defined as the amount that is taken from the customers in advance of the order actually being processed. In other words, customer advances are the payments that have been received from the customers in advance. Corresponding order fulfillment for that particular order has not been accounted for. …
How to Account for Advance from Customers? (Example and Journal Entries) Read More »
In the modern-day business dynamic, many transactions are carried out on credit. This involves organizations purchasing goods and services on credit and selling goods and services on credit. Credit basically refers to paying at a later date and getting goods and services earlier in advance. This is a normal business practice and should be accounted …
How to Account for Advance to Suppliers? (Example and Journal Entries) Read More »
Accrued revenue is revenue that a business earns for providing goods or rendering services to its customers for which payment hasn’t been made yet. Accrued revenue is an important component of accrual accounting. It is important to understand the fundamental principles of accrual accounting and how these principles are applied in accounting for accrued revenue. …
Accrued Revenue: Definition, Measurement, Classification and Journal Entries Read More »
Many businesses have physical locations from where they operate. The need to have a business location compels businesses to either buy or rent a place for their operations. Accrued rent is therefore the sum of all rents that the tenant owes the landlord for making use of their property. Landlords normally receive rent in advance. …
Accrued Rent: Definition, Measurement, Classification and Journal Entries Read More »
Overview Internet expense is an expense for the business which is incurred during a financial year. As it is with all the other expenses of the business, the interest expense as well needs to be recorded for the amount of the expense that has been incurred during the year, regardless of the fact if any …
What Is Adjusting Entry for Interest Expense? (Example and Explanation) Read More »
Accrued expense payable is a vital concept in accounting and has a lot of implications for businesses. Every business has some obligations that they are expected to meet up with. The financial expenses incurred by businesses from different suppliers from which no invoice has been issued are referred to as accrued expenses payable. While recording …
What are the Accrued Expenses Payable in Account? Read More »
Depreciation expenses of an asset that is accumulated over the years are called accumulated depreciation. Fixed assets have a carrying amount resulting from the difference between the cost of fixed assets minus accumulated depreciation of that asset and any possible impairment. Accumulated depreciation is build up with the time once we start to depreciate an …
Accumulated Depreciation in Accounting: How do you calculate it Read More »
The conventional overhead allocation method assumes that various types of the fixed overhead cost can be absorbed in different products using a single overhead absorption rate. This approach of the conventional method is over-simplistic and does not seem to produce individual product costs with greater accuracy and precision. However, it’s quick, and the cost allocation …
Activity-based Costing (ABC Costing) Ultimate Guide (Step by Step Guide) Read More »
Definition Accrued wages refer to the total amount of liability that remains in the books of accounts at the end of an accounting period. These are the workers’ wages, but the business has not paid them as of period closing (although workers have performed their work). Recording of the accrued wages helps the business to …
Accrued Wages (Definition, Measurement, Classification, and Journal Entry) Read More »
