Accounting Tools

APRIL 17, 2024

For example, the Internal Revenue Service may mandate that a specific depreciation period be used for a fixed asset , while the internal accounting policies of a business dictate the use of a different number of periods. The accountant uses a different depreciation approach when developing financial statements for tax purposes.

Tax 40

Tax Financial Reporting Reconciling Financial Statements 40

Accounting Tools

OCTOBER 4, 2023

If an entity is recording its business transactions under the accrual basis of accounting , it is quite possible that the profitability condition will not be matched by the cash flows generated by the organization, since some accrual-basis transactions (such as depreciation ) do not involve cash flows.

Accruals 75

Accruals Financial Statements Tax Accounting 75

Accounting Tools

MARCH 29, 2024

Related AccountingTools Courses Business Ratios Guidebook The Interpretation of Financial Statements How to Calculate the Fixed Asset Turnover Ratio The formula for the ratio is to subtract accumulated depreciation from gross fixed assets, and divide that amount into net annual sales. Sales over the last 12 months totaled $9,000,000.

Financial Statements 40

Financial Statements 40

Accounting Tools

JUNE 20, 2023

Note: The lease accounting noted in this article changed with the release of Accounting Standards Update 2016-02, which is now in effect. Depreciation. Related Courses Accounting for Leases How to Account for a Capital Lease A capital lease is a lease in which the lessee records the underlying asset as though it owns the asset.

Accounting 75

Accounting Accounting Accounts Payable Accounts Payable 75

Accounting Tools

FEBRUARY 15, 2024

The ratio compares the EBITDA (earnings before interest, taxes, depreciation and amortization) and lease payments of a business to the aggregate amount of its loan and lease payments. Example of the EBITDA Coverage Ratio As an example of the EBITDA coverage ratio, the annual EBITDA of ABC International is $550,000.

Financial Statements 40

Financial Statements Tax Accounting Accounting 40

Accounting Tools

AUGUST 7, 2023

Related Courses Fixed Asset Accounting How to Audit Fixed Assets What is Depreciation? Depreciation is the process of charging the cost of a fixed asset to expense over a period of time. When this charge is made, the entry is a debit to the depreciation expense account and a credit to the accumulated depreciation account.

Corporation Tax 40

Corporation Tax Tax Auditing Accounting 40

Accounting Tools

MARCH 1, 2024

For example, some fixed assets are tax deductible at once, but can only be recognized through long-term depreciation in the financial statements. Even nonprofit entities are required to file annual informational returns, so that the IRS can determine whether these organizations are complying with the rules for tax-exempt entities.

Tax 75

Tax Accounting Accounting Financial Statements 75

Accounting Tools

MAY 15, 2023

These changes should be well-documented, since they will be examined by the company's auditors as part of the annual audit. Amortization vs. Depreciation Amortization relates to the ratable reduction in the recorded value of intangible assets, while depreciation is the ratable reduction in the recorded value of tangible assets.

Auditing 75

Auditing Accounting Accounting 75

Counto

FEBRUARY 4, 2024

Recurring Expenses: These happen repeatedly over time, either daily, weekly, monthly, quarterly, or annually, with amounts that may fluctuate. Depreciation: Depreciation on assets, including buildings, machinery, and equipment, can be claimed as capital allowances to offset depreciation.

Tax 52

Tax Payroll Accounting Accounting 52

Accounting Tools

JULY 19, 2023

Useful life is the estimated lifespan of a depreciable fixed asset , during which it can be expected to contribute to company operations. This is an important concept in accounting, since a fixed asset is depreciated over its useful life. However, depreciation can reduce the tax liability of a business, resulting in lower tax payments.

Computation 40

Computation Auditing Tax Accounting 40

Accounting Tools

NOVEMBER 3, 2023

Example of the Iron Curtain Method An accountant incorrectly set up the depreciation calculation on a fixed asset five years ago. The annual impact of this error is $10,000, which is immaterial. Related Articles Material Misstatement Risk of Material Misstatement In this case, a financial statement correction is indicated.

Financial Statements 40

Financial Statements Accounting Accounting 40

Accounting Tools

JUNE 12, 2023

The Securities and Exchange Commission requires that all entities that are publicly held must file annual reports with it that are audited. Observe assets, review purchase and disposal authorizations, review lease documents, examine appraisal reports, recalculate depreciation and amortization. Fixed assets. Accounts payable.

Financial Statements 76

Financial Statements Auditing General Ledger Bank Reconciliation 76

Accounting Tools

JULY 20, 2023

Thus, if a company projects that it will earn an average annual profit of $70,000 on an initial investment of $1,000,000, then the project has an accounting rate of return of 7%. If the project involves cost reduction instead of earning a profit, then the numerator is the amount of cost savings generated by the project.

Accruals 40

Accruals Accounting Accounting Financial Analysis 40

Counto

FEBRUARY 4, 2024

Examples include emergency equipment repairs and annual bonuses. Depreciation Depreciation accounts for the spread of costs over the useful life of assets like office furniture and company cars. They can vary based on your company’s activities and needs. Want to schedule a demo?

Payroll 52

Payroll Budgeting Tax Auditing 52

Accounting Tools

MAY 19, 2023

Thus, the receivable turnover formula is: Net annual credit sales ÷ ((beginning receivables + ending receivables) / 2) = Receivable turnover A high ratio indicates that the company is selective about only selling to the highest-quality customers, sets conservative payment terms, and collects overdue invoices aggressively.

Accounts Payable 40

Accounts Payable Accounts Payable Financial Statements Collections 40

Accounting Tools

SEPTEMBER 26, 2023

One exception is when non-cash expenses , such as depreciation and amortization , are driving down net income below the amount of cash flows that are actually being generated. Related Articles Price Earnings Multiple Shareholder Value Shareholder Value Added Total Shareholder Return

Accruals 75

Accruals Corporate Finance Collections Accounting 75

Counto

MAY 29, 2023

In this article, we will discuss some key dates in filing taxes and tax exemptions that you should be aware of as a business owner in Singapore. To qualify for the Form C-S Lite corporate tax filing, a company must have an annual income of $200,000 or less and meet all Form C-S criteria.

Corporation Tax 52

Corporation Tax Tax Bookkeeping Services Financial Statements 52

Accounting Tools

SEPTEMBER 2, 2023

This payment can be the lesser of 90% of the partnership's expected annual income, or 100% of the actual tax paid in the immediately preceding year. Related Articles Forming a Partnership Partnership Accounting Partnership Advantages and Disadvantages Partnership Agreement The amounts of any preferential payments to certain partners.

Accruals 40

Accruals Tax Accounting Accounting 40

Accounting Tools

DECEMBER 19, 2023

Public Company Footnotes An even more extensive set of footnotes is required by the Securities and Exchange Commission of any publicly held company when they issue their annual financial statements in the Form 10-K and quarterly financial statements in the Form 10-Q. Inventories. Fixed assets. Goodwill and intangibles.

Financial Statements 40

Financial Statements Reconciling Auditing Accounting 40

Accounting Tools

SEPTEMBER 21, 2023

Update it by including the year-to-date actual expenses incurred in the current year, and also annualize this information for the full current year. Update the depreciation expense in the model, based on the fixed asset disposal and capital budget request information already received.

Budgeting 40

Budgeting Payroll Data Entry Financial Software 40

Accounting Tools

JULY 27, 2023

Budget Analyst The budget analyst position is responsible for coordinating the assembly of the annual budget, loading it into the accounting software, comparing it to actual results, and reporting on variances. This position also handles sales taxes and income taxes. This position is only found in a small accounting department.

General Ledger 40

General Ledger Accounting Accounting Payroll 40

Future Firm

MARCH 14, 2023

If you’re curious how much your firm is worth and how to increase your firm’s valuation, you’ll want to read this article on how to value a CPA firm. The longer the payout period, the smaller the purchase payments and, consequently, the greater the annual cash flow generated by the transaction. Let’s go!

CPA 52

CPA Accounts Receivable Accounts Receivable Account Receivables 52

Accounting Tools

AUGUST 31, 2023

An alternative way to calculate the cash flow of an entity is to add back all non-cash expenses (such as depreciation and amortization ) to its net after-tax profit, though this approach only approximates actual cash flows. What Causes Cash Inflows? Cash inflows come from the sources noted below.

Accruals 75

Accruals Financial Statements Accounts Payable Accounts Payable 75

Jetpack Workflow

MARCH 23, 2023

This article will share why having this checklist is important, the key items to include, and a free template to get you started. One of those transactions is the depreciation expense, which helps you recover the cost of the item over its life. A checklist is essential during the monthly closing process.

Reconciling 52

Reconciling AR AP Payroll 52

Accounting Tools

AUGUST 6, 2023

The formula is as follows: Annual cost of goods sold / Ending inventory = Inventory turnover In the calculation, the cost of goods sold refers to the cost of the finished goods or services delivered to customers. Related Articles ABC Analysis Average Age of Inventory Days’ Sales in Inventory Inventory Analysis

Purchase Order 40

Purchase Order Budgeting Collections Accounting 40

Cloud Accounting Podcast

JUNE 28, 2020

You get 24/7 on-demand view of your books, automated daily bookkeeping, transactions classified daily; bank, credit card, loan, and payroll reconciliations; annual tax depreciation; expert-checked monthly P&L, and expert-checked monthly balance sheet. David Leary: [00:11:08] I think there's some add-ons. Why did this happen?

Bookkeeping 40

Bookkeeping QuickBooks Payroll Auditing 40

Cloud Accounting Podcast

SEPTEMBER 1, 2020

It's completely divorced from reality, that kind of thinking, because- David Leary: [00:06:33] This is gonna tie into some articles I brought in for later, actually. Intuit released their earnings; they had a 13% annual growth driven by strong TurboTax performance. It's perfect, about deferring payments on things.

Payroll 40

Payroll Tax QuickBooks CPA 40