Accounting Tools

SEPTEMBER 7, 2023

A classified balance sheet presents information about an entity's assets , liabilities , and shareholders' equity that is aggregated (or "classified") into subcategories of accounts. Related Courses The Balance Sheet The Interpretation of Financial Statements What is a Classified Balance Sheet?

Computation 75

Computation Financial Statements Tax Accounting 75

Accounting Tools

MAY 4, 2024

Related AccountingTools Courses Business Ratios Guidebook Key Performance Indicators The Interpretation of Financial Statements Liquidity Ratios The most-recognized liquidity ratio is the current ratio , which compares current assets to current liabilities. Net annual credit sales divided by average receivables.

Accounting 40

Accounting Accounting Financial Statements Accounts Receivable 40

Accounting Tools

MARCH 1, 2024

Tax accounting refers to the rules used to generate tax assets and liabilities in the accounting records of a business or individual. These differences are temporary, since the assets will eventually be recovered and the liabilities settled, at which point the differences will be terminated. What is Tax Accounting? Future years.

Tax 75

Tax Accounting Accounting Financial Statements 75

Accounting Tools

MAY 6, 2024

The operating cash flow ratio measures the ability of a business to pay for its current liabilities from its reported operating cash flows. The best-case scenario is when the ratio reveals operating cash flows that are several multiples of the liabilities that must be settled. What is the Operating Cash Flow Ratio?

Accruals 40

Accruals Financial Statements Accounting Accounting 40

Accounting Tools

OCTOBER 24, 2023

Related Courses The Balance Sheet What is the Current Portion of Long-Term Debt? The current portion of long-term debt is a amount of principal that will be due for payment within one year of the balance sheet date. Related Articles Long-Term Liabilities Related Articles Long-Term Liabilities

75

75

Accounting Tools

JUNE 16, 2023

Related Courses Business Ratios Guidebook The Interpretation of Financial Statements The current ratio and quick ratio are both designed to estimate the ability of a business to pay for its current liabilities.

Financial Statements 75

Financial Statements 75

Accounting Tools

NOVEMBER 7, 2023

Related Courses Accounting for Income Taxes How to Account for Income Taxes The essential accounting for income taxes is to recognize tax liabilities for estimated income taxes payable, and determine the tax expense for the current period. Future years.

Tax 75

Tax Financial Statements Accounting Accounting 75

Accounting Tools

MAY 16, 2024

A tax loss reduces an entity's tax liability only in proportion to its tax bracket. This means that a tax loss is not irrevocably lost if it cannot be employed within the current year’s tax return. Related Articles Net Operating Loss Carryback and Carryforward Worthless Securities

Tax 40

Tax Financial Statements Financial Reporting Accounting 40

Xero

JANUARY 30, 2024

Australia’s current property market presents both challenges and opportunities, with changing tenancy rules and rental controls, and the impact of interest rates and cost of living pressures. The ATO categorises these into three groups: expenses claimable in the current financial year (e.g. personal expenses from property use).

XERO 238

XERO Accounting Accounting Bank Reconciliation 238

Accounting Tools

FEBRUARY 15, 2024

What is a Liability Account? A liability account is used to store all legally binding obligations payable to a third party. It contains the amount of each liability formally recognized by an organization, including liabilities for goods received on credit, bank loans payable, compensation payable, and so forth.

General Ledger 40

General Ledger Accounting Accounting Deposits 40

Accounting Tools

DECEMBER 22, 2023

Customer Advance Due to Cash Basis Accounting The customer may be operating under the cash basis of accounting , and so wants to pay cash as soon as possible in order to recognize an expense and reduce its reportable income in the current tax year. Debit the cash account and credit the customer advances (liability) account.

Accounting 75

Accounting Accounting Reconciling Bookkeeping 75

Accounting Tools

MARCH 20, 2024

What is an Estimated Liability? An estimated liability is an obligation for which there is no definitive amount. This results in an accrued expense that appears within the current liabilities section of the balance sheet. Defined benefit pension liability. Here are several examples: Warranty reserve.

Accounting 40

Accounting Accounting 40

Accounting Tools

MAY 13, 2024

The areas in the balance sheet in which real accounts are found are assets , liabilities , and equity. Real accounts also include contra asset , contra liability , and contra equity accounts, since these accounts retain their balances beyond the current fiscal year.

Accounting 40

Accounting Accounting Bookkeeping Accounts Payable 40

Accounting Tools

JUNE 21, 2023

Working capital is current assets minus current liabilities. A high turnover ratio indicates that management is being extremely efficient in using a firm's short-term assets and liabilities to support sales. This is an especially useful comparison when the benchmark companies have a similar capital structure.

Accounts Payable 75

Accounts Payable Accounts Payable Accounts Receivable Accounts Receivable 75

Accounting Tools

DECEMBER 18, 2023

An accrual is an expense that has been recognized in the current period for which a supplier invoice has not yet been received, or revenue that has not yet been billed. What is the impact of such an accrual on the balance sheet , where assets , liabilities , and equity items are located?

Accruals 40

Accruals Bookkeeping Billing Invoicing 40

Accounting Tools

NOVEMBER 24, 2023

A short term asset is an asset that is to be sold, converted to cash , or liquidated to pay for liabilities within one year. Presentation of Short Term Assets Short term assets are always presented within the current assets classification of an organization’s balance sheet , which is near the top of the report.

Accounts Receivable 72

Accounts Receivable Accounts Receivable Account Receivables Accounting 72

Counto

APRIL 7, 2024

Advantages of Converting from Sole Proprietorship to Pte Ltd Limited Liability Protection: Shield your personal assets from business liabilities with the limited liability protection offered by Pte Ltd companies. Resolve any outstanding debts or liabilities of the Sole Proprietorship before initiating the conversion process.

Tax 52

Tax Accounting Accounting 52

Accounting Tools

APRIL 18, 2024

Income tax payable is a liability that an entity incurs that is based on its reported level of profitability. Once the organization pays the income tax , the liability is eliminated. Any income tax payable within a longer period is instead classified as a long-term liability. Related Article Provision for Income Taxes

Tax 40

Tax Expense Reports Accounting Accounting 40

Accounting Tools

JUNE 6, 2023

In this situation, create a journal entry to shift the amount of the overdrawn checks into the accounts payable or a similar current liability account; doing so reduces the balance in the checking account to zero, and properly displays the overdrawn amount as a current liability.

Bookkeeping 72

Bookkeeping Accounts Payable Accounts Payable Financial Accounting 72

Accounting Tools

APRIL 18, 2024

If the zoning commission had not indicated the company’s liability, it may have been more appropriate to only mention the loss in the disclosures accompanying the financial statements. Related Article Contingent Liability If there is no “better estimate” in the range, accrue a loss for the minimum amount in the range.

Accounting 75

Accounting Accounting Financial Statements Auditing 75

Accounting Tools

APRIL 9, 2024

What is a Warranty Liability? A warranty liability is a liability account in which a company records the amount of the repair or replacement cost that it expects to incur for products already shipped or services already provided. This can be a significant liability for more complex products that are subject to breakage.

Financial Statements 40

Financial Statements Accounting Accounting 40

Accounting Tools

OCTOBER 28, 2023

What are Net Current Assets? Net current assets is the aggregate amount of all current assets , minus the aggregate amount of all current liabilities. There should be a positive amount of net current assets on hand, since this implies that there are sufficient current assets to pay for all current obligations.

Accounts Payable 40

Accounts Payable Accounts Payable Accounts Receivable Accounts Receivable 40

Accounting Tools

FEBRUARY 12, 2024

The two main types of assets are current assets and non-current assets. Related Articles Asset Accounts Asset Recognition Criteria Examples of Assets Nonmonetary Assets The Difference Between Assets and Liabilities Total Assets An asset is an expenditure that has utility through multiple future accounting periods.

Deposits 75

Deposits Accounts Receivable Accounts Receivable Account Receivables 75

Accounting Tools

OCTOBER 11, 2023

Current ratio. The formula is current assets, divided by current liabilities. Ideally, a business wants to have several times more current assets than current liabilities, in order to be assured of paying its bills on time. Quick ratio.

Financial Statements 75

Financial Statements Accruals Billing Collections 75

Accounting Tools

SEPTEMBER 8, 2023

Related Courses The Balance Sheet The interpretation of Financial Statements What is a Current Liability? A current liability is an obligation that is payable within one year. Current liabilities may also be settled through their replacement with other liabilities, such as with short-term debt.

Accounts Payable 40

Accounts Payable Accounts Payable Computation Deposits 40

Accounting Tools

MARCH 26, 2024

Bonds payable is a liability account that contains the amount owed to bond holders by the issuer. Presentation of Bonds Payable The bonds payable account typically appears within the long-term liabilities section of the balance sheet , since bonds typically mature in more than one year. What is Bonds Payable?

Accounting 40

Accounting Accounting 40

Accounting Tools

MARCH 22, 2024

Presentation of Payables The amounts owed to a trade creditor are stated on the balance sheet of a customer as a current liability , since these obligations are nearly always due within one year. Related AccountingTools Course Payables Management Related Articles 1099 Vendor Trade Payable

Financial Statements 40

Financial Statements 40

Accounting Tools

JANUARY 24, 2024

Accounting for Dividends Declared Dividends declared are recorded in the accounting records as a liability of the corporation. If the dividends are to be paid within one year (as is usually the case), then this liability is classified as a current liability on the balance sheet of the issuing entity.

Accounting 40

Accounting Accounting 40

Accounting Tools

MAY 10, 2024

The general categories of asset accounts are as follows, along with the accounts commonly used within each category: Current Asset Accounts Cash. Other current assets. Related Articles Asset Classification Examples of Assets The Difference Between Assets and Liabilities Types of Assets Bank deposits.

Petty cash 75

Petty cash Accounting Accounting Accounts Receivable 75

Accounting Tools

NOVEMBER 7, 2023

When the sales taxes are due for payment, the company pays cash to the government, which eliminates its sales tax liability. In this situation, sales tax is a liability. It charges the sales tax to expense in the current period, along with the cost of the items purchased.

Tax 75

Tax Collections Accounting Accounting 75

Accounting Tools

OCTOBER 27, 2023

Related Courses Working Capital Management Working capital is calculated by subtracting current liabilities from current assets. If so, these receivables cannot be considered current assets, and so should be excluded from the calculation. Current liabilities are obligations that are payable within one year.

Accounts Payable 40

Accounts Payable Accounts Payable Financial Analysis Accounting 40

Accounting Tools

FEBRUARY 9, 2024

Working capital is the amount of an entity's current assets minus its current liabilities. Note: Current assets are any assets considered to be collectible within one year, while current liabilities are any liabilities expected to be settled within one year. What is Working Capital?

Accounts Payable 40

Accounts Payable Accounts Payable Accounts Receivable Accounts Receivable 40

Accounting Tools

OCTOBER 28, 2023

An account balance is the current total in an account. General Ledger Account In accounting, the account balance is the current residual balance in an account. An account balance can be found for any type of account, such as a revenue , expense , asset , liability , or equity account.

General Ledger 75

General Ledger Accounting Accounting Account Reconciliation 75

Accounting Tools

OCTOBER 13, 2023

The ratio is the relative proportion of an entity's current assets to its current liabilities , and shows the ability of a business to pay for its current liabilities with its current assets. Current assets include cash , short-term investments , trade receivables , and inventory.

Financial Statements 40

Financial Statements Accounts Payable Accounts Payable Accounts Receivable 40

Accounting Tools

MARCH 7, 2024

An asset retirement obligation (ARO) is a liability associated with the eventual retirement of a fixed asset. The liability is commonly a legal requirement to return a site to its previous condition. Recognize any period-to-period increase in the carrying amount of the ARO liability as accretion expense.

Financial Statements 40

Financial Statements Accounting Accounting 40

Accounting Tools

JULY 23, 2023

Negative working capital occurs when a business has more current liabilities than current assets. However, there are several situations in which this is not a problem, including the following: If an organization has a line of credit , it can readily draw down the line to pay for liabilities as they come due.

Financial Statements 40

Financial Statements 40

Accounting Tools

SEPTEMBER 22, 2023

Related Courses Accountants' Guidebook GAAP Guidebook How to Audit Liabilities A liability is a a legally binding obligation payable to another entity. Liabilities are a component of the accounting equation , where liabilities plus equity equals the assets appearing on an organization's balance sheet. Accrued liabilities.

Accounting 40

Accounting Accounting Accounts Payable Accounts Payable 40