What is Indirect Cost? Definition, Explanation, Types, and example 17 april 2023 – Posted in: Bookkeeping

In the realm of business studies, grasping the concept of indirect costs is essential. These costs, often referred to as overheads, are necessary for maintaining business operations but are not directly attributable to a specific product, service, or project. (As a reminder, a cost object is typically a product.) “Indirect costs” are those that cannot be directly traced to a single cost object. Because they cannot be traced directly to a specific cost object, indirect…

What Is A Note Payable? 27 maart 2023 – Posted in: Bookkeeping

It’s usually recorded as ‘Interest Payable’ – a current liability if the interest is due within a year of the balance sheet date. The related interest expense affects the income statement, thereby also impacting the company’s retained earnings and overall equity. The value of getting journal entries correct, especially for significant items like Notes Payable, can’t be overemphasised. Errors in recording these transactions could potentially skew the financial statements and misrepresent a company’s financial health.…

Are Travel Reimbursements Taxable? What You Need to Know 9 maart 2023 – Posted in: Bookkeeping

To create a fair compensation program, you should follow the best practices for mileage reimbursement in your industry and the IRS mileage reimbursement rules for employers. Smart software solutions have become an irreplaceable ally in tracking speed, distance, and the exact time for each location. They enable a well-organized and straightforward system for handling employee mileage reimbursements. This article will help you better understand IRS mileage reimbursement rules, regulations, and rates, enabling you to make…

Explain the Basic Accounting Equation: Understanding the Relationship between Assets, Liabilities, and Equity 27 december 2022 – Posted in: Bookkeeping

Consistent application Financial Forecasting For Startups of the accounting equation enhances financial literacy and transparency across business operations. Another common misconception is that a balanced equation implies a healthy business. While balance is necessary, it doesn’t directly reflect profitability or cash flow. A. Definition of Liabilities The accounting equation is more than just a theoretical tool—it’s the backbone of a company’s balance sheet. Furthermore, qualitative factors such as management efficiency or employee satisfaction are outside…

Imprest Definition, What is Imprest, Advantages of Imprest, and Latest News 12 oktober 2022 – Posted in: Bookkeeping

If the petty cash fund is consistently depleted before the replenishment cycle, the imprest amount may need to be increased. This analysis should align with budget reviews to ensure the imprest system remains cost-effective. Despite being the best best option for conventional petty cash funds, the imprest system does have its drawbacks. The imprest system works by allocating a set amount of cash to an account or ‘float’. This float is a standalone fund that’s…

Weighted Average Shares Outstanding Example How to Calculate 8 augustus 2022 – Posted in: Bookkeeping

Together, these filings equip stakeholders with the tools to evaluate a company’s financial health and equity structure. The number of shares outstanding increases whenever a company undertakes a stock split. Stock splits are usually undertaken to bring the share price of a company within the buying range of retail investors; the increase in the number of outstanding shares also improves liquidity. Definition of Common Stock Outstanding If you’re interested in learning about common stock, you…

Bookkeeping Service CPA Bookkeeper Irvine, CA 28 juli 2022 – Posted in: Bookkeeping

I also received some of the best tax and general business advice from them. Use our secure portal to send over your documents and provide us with access to QuickBooks, Sage, or whatever bookkeeping software you prefer. Our bookkeeping service, based in Irvine, CA aims to bring up and promote women in the accounting industry and we feel that these values set us apart. Accountant (Remote) Additionally, QuickBooks some firms neglect proper documentation, such as…

Contribution Margin Overview, Guide, Fixed Costs, Variable Costs 13 juli 2022 – Posted in: Bookkeeping

Profit, on the other hand, is the amount that remains after both the variable and fixed costs have been fully covered. You might wonder why a company would trade variable costs for fixed costs. One reason might be to meet company goals, such as gaining market share. Other reasons include being a leader in the use of innovation and improving efficiencies. Step 2: Determine Variable Costs Contribution margin and gross margin are both important profitability…

What is the percentage-of-sales method? 20 juni 2022 – Posted in: Bookkeeping

He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University. By integrating AI into your sales strategy, you can identify underperforming areas, adjust pricing dynamically, and improve customer engagement. AI unifies sales data from various channels, offering a 360-degree view that enables smarter, faster decisions. Higher conversions, stronger customer relationships, and sustainable revenue growth. We hope this article gives you a better understanding…

Understanding Encumbrance Accounting & Its Process 27 mei 2022 – Posted in: Bookkeeping

To record the encumbrance, you’ll need to complete the following encumbrance accounting processes by recording the following journal entries. It’s not a prepaid expense, as the cash hasn’t left your account, nor is it retained earnings an accrued expense, as it also hasn’t been incurred. Organizations account for future expenditures by enforcing budgetary controls and monitoring spending. The Importance of Managing Encumbrances for Budgetary Compliance This involves updating the encumbrance amounts as commitments are fulfilled…