Category: Bookkeeping 101

How Do Accounts Payable Show on the Balance Sheet?

Jul 13, 2020 Bookkeeping 101 by ann
This allows them to continue to build their business, so in some sense, the loan could be considered an investment in a business’ own ability to grow. The drawback is that a debt is considered a business liability, and non-payment may result in further penalties and potentially even legal action. What are examples of current
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3.5 Process Costing

Jul 10, 2020 Bookkeeping 101 by ann
You then add them to the already completed units to get 750,000. This gives you the number of equivalent whole units you have produced. The production cost report takes data from production and reports it as total amounts incurred during the associated time period. This report is used by management to analyze production processes and
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Accounting for Investments: Cost or Equity Method

Jul 10, 2020 Bookkeeping 101 by ann
Example of the Equity Method Since intercompany investments typically involve owning stock, you’d list the value of the investment as the price you paid for the shares. Once the investment is on the balance sheet, however, the cost and equity methods diverge substantially. The equity method does not combine the accounts in the statement, but
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How do share capital and paid-up capital differ?

Jul 10, 2020 Bookkeeping 101 by ann
Balance sheet analysis is central to the review and assessment of business capital. Split between assets, liabilities, and equity, a company’s balance sheet provides for metric analysis of a capital structure. Debt financing provides a cash capital asset that must be repaid over time through scheduled liabilities. For instance, assume that a mutual fund client
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What Are the 4 Major Business Organization Forms?

Jul 10, 2020 Bookkeeping 101 by ann
Importance/need of business entity concept The primary characteristic an LLC shares with a corporation is limited liability, and the primary characteristic it shares with a partnership is the availability of pass-through income taxation. As a business entity, an LLC is often more flexible than a corporation and may be well-suited for companies with a single
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