Accounting Tools

MARCH 3, 2024

Comparing Liabilities and Debt The main difference between liability and debt is that liabilities encompass all of one’s financial obligations , while debt is only those obligations associated with outstanding loans. Thus, debt is a subset of liabilities.

Bookkeeping 75

Bookkeeping Auditing Accounting Accounting 75

Accounting Tools

MARCH 29, 2024

The concept most commonly applies to the lending of funds, where a borrower applies for a loan , and there is a credit evaluation by the lender. The lender may also require that the borrower provide collateral that the lender can access if the loan is not repaid in a timely manner.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

MARCH 28, 2024

A lender is an entity that makes cash loans to other entities or individuals in exchange for either a fixed or variable interest rate and a promise of repayment. There are several options for the repayment of these loans, such as in accordance with a fixed monthly schedule or a lump sum payment that is due on the maturity date of the loan.

Corporate Finance 40

Corporate Finance 40

Counto

FEBRUARY 15, 2024

Best SME Loans in Singapore (2024) Are you a small business or SME owner in Singapore looking to bolster your cash flow with a loan? Navigating the landscape of business loans can be daunting, but fear not—we’ve got you covered. Advantages of Business Loans 1.

Invoicing 52

Invoicing Financial Statements Payroll Financial Reporting 52

Accounting Tools

OCTOBER 8, 2023

If the borrower does not repay the loan , the lender has the right to collect the assigned receivables. The amount loaned is usually a percentage of the outstanding receivables in the accounts assigned to the lender. Under this arrangement, the borrower pays interest on the loaned funds, as well as a service charge.

Accounts Receivable 75

Accounts Receivable Accounts Receivable Account Receivables Accounting 75

Counto

FEBRUARY 17, 2024

Enhancements to Enterprise Financing Scheme (EFS) The EFS will undergo three significant enhancements to better address the financial needs of SMEs: Increased Working Capital Loan Quantum : The maximum working capital loan quantum will be permanently raised to S$500,000, up from S$300,000.

Budgeting 52

Budgeting Tax Accounting Accounting 52

Counto

FEBRUARY 17, 2024

Enhancements to Enterprise Financing Scheme (EFS) The EFS will undergo three significant enhancements to better address the financial needs of SMEs: Increased Working Capital Loan Quantum : The maximum working capital loan quantum will be permanently raised to S$500,000, up from S$300,000.

Budgeting 52

Budgeting Tax Accounting Accounting 52

Accounting Tools

SEPTEMBER 7, 2023

For example, a bank loans ABC Company $1,000,000; ABC records the entry as follows: Debit Credit Cash 1,000,000 Notes payable 1,000,000 The note has a 5% interest rate, payable quarterly to the bank. An example of a notes payable is a loan issued to a company by a bank.

Accruals 75

Accruals Accounts Payable Accounts Payable Auditing 75

Accounting Tools

MARCH 8, 2024

Example of a Contractual Interest Rate As an example of a contractual interest rate, a lender offers a borrower a $50,000 loan with a maturity date in 36 months. The contractual interest rate on this loan is 8% per year.

Corporate Finance 40

Corporate Finance Accounting Accounting 40

Accounting Tools

JUNE 19, 2023

The amortization concept is also used in lending, where an amortization schedule itemizes the beginning balance of a loan , less the interest and principal due for payment in each period, and the ending loan balance. This schedule is quite useful for properly recording the interest and principal components of a loan payment.

Auditing 75

Auditing Accounting Accounting 75

Accounting Tools

MARCH 29, 2024

All inventory within the fence is collateral for a loan from the finance company to the borrower. If the level of inventory drops below the amount of the loan, the borrower must pay back the finance company the difference between the outstanding loan amount and the total inventory valuation.

Corporate Finance 40

Corporate Finance Accounts Receivable Accounts Receivable Account Receivables 40

Accounting Tools

FEBRUARY 15, 2024

The EBITDA coverage ratio measures the ability of an organization to pay off its loan and lease obligations. 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.

Financial Statements 40

Financial Statements Tax Accounting Accounting 40

Accounting Tools

OCTOBER 26, 2023

The deductions that can be taken from gross pay to arrive at net salary include (but are not limited to) the following: Federal income tax State and local income taxes Social Security tax Medicare tax Health insurance deductions Flexible spending account deductions Pension deductions Repayment of company loans or advances Charitable donation deductions (..)

Payroll 75

Payroll Tax Accounting Accounting 75

Accounting Tools

OCTOBER 12, 2023

Related Courses Corporate Cash Management Corporate Finance Treasurer's Guidebook What is a Secured Loan? A secured loan is a lending agreement in which the borrower pledges an asset as collateral , which the lender can seize if the borrower cannot pay back the underlying loan.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

SEPTEMBER 23, 2023

Loan Reimbursement Deduction The employee may have borrowed money from the employer, in which case the employer deducts all or a portion of the outstanding loan amount from the periodic wages of the employee. The employer tracks ongoing loan reimbursements, and terminates these deductions when the loan has been paid back.

Payroll 75

Payroll Tax Accounting Accounting 75

Accounting Tools

SEPTEMBER 10, 2023

Related Courses Corporate Cash Management Corporate Finance Treasurer's Guidebook What is a Fixed Rate Loan? A fixed rate loan is a lending arrangement in which the interest rate charged does not change for the life of the loan.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

JUNE 8, 2023

Related Courses Excel Formulas and Functions Financial Analysis Introduction to Excel The effective interest rate is the usage rate that a borrower actually pays on a loan. Locate the stated interest rate in the loan documents. It can also be considered the market rate of interest or the yield to maturity.

Financial Analysis 75

Financial Analysis 75

Accounting Tools

APRIL 7, 2024

A positive debt service ratio indicates that an organization’s cash flows can cover all offsetting debt payments, while a negative ratio indicates that the business must contribute additional funds to pay for the annual loan payments.

Financial Statements 40

Financial Statements Tax 40

Accounting Tools

SEPTEMBER 10, 2023

Related Courses Auditing State and Local Governments Governmental Accounting The Green Book Explained The Yellow Book Explained What is a Soft Loan? A soft loan is a loan that features a below-market interest rate or no interest at all. In the latter case, soft loans are intended to be a form of economic aid.

Auditing 40

Auditing Accounting Accounting 40

Accounting Tools

SEPTEMBER 22, 2023

Related Courses Corporate Cash Management Corporate Finance Treasurer's Guidebook What is a Variable Rate Loan? A variable rate loan is a lending arrangement under which the interest rate varies in accordance with changes in a standard rate. Treasury securities.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

OCTOBER 27, 2023

Related Courses The Balance Sheet What is a Loan Payable? A loan is an arrangement under which the owner of property allows another party the use of it (usually cash ) in exchange for an interest payment and the return of the property at the end of the lending arrangement. The loan is documented in a promissory note.

Accounts Payable 40

Accounts Payable Accounts Payable Accounting Accounting 40

Accounting Tools

OCTOBER 26, 2023

Example of the Weighted Average Interest Rate Calculation A business has a $1,000,000 loan outstanding on which it pays a 6% interest rate. It also has a $500,000 loan outstanding on which it pays an 8% interest rate. The annual amount paid on the first loan is $60,000, and the annual amount paid on the second loan is $40,000.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

NOVEMBER 1, 2023

Related Courses GAAP Guidebook How to Account for an Impaired Loan It may be necessary to account for a loan that is considered to be impaired. A business may own one or more loans that are payable by third parties. If loans are subsequently recovered, the previous charge-off transaction should be reversed.

Accounting 40

Accounting Accounting Collections 40

Accounting Tools

MARCH 19, 2024

It can be quite difficult for a business to obtain a loan when it has an accumulated deficit, since this is a sign for lenders that the business is not generating sufficient cash flow to pay off the loan.

Financial Statements 40

Financial Statements Bookkeeping 40

Cloud Accounting Podcast

MARCH 21, 2024

They also get into Minnesota's CPA licensure bill for 150-hour requirement alternatives and KPMG's audit findings on the Department of Education and the cost of the federal student loan program.

CPA 49

CPA Billing Customer Service Collections 49

Accounting Tools

APRIL 12, 2024

The term also refers to the interest rate that the Federal Reserve Bank charges to depository institutions that take loans from the Fed's discount window. Related AccountingTools Courses Capital Budgeting Financial Analysis Related Article Risk-Adjusted Discount Rate

Financial Analysis 40

Financial Analysis Budgeting 40

Accounting Tools

JUNE 12, 2023

Related Courses Corporate Cash Management Corporate Finance What is an Evergreen Loan? An evergreen loan is a revolving line of credit that does not require the borrower to pay down the outstanding balance at any point prior to the maturity date of the loan.

Corporate Finance 40

Corporate Finance Accounting Accounting 40

Accounting Tools

JANUARY 24, 2024

The amounts owed should be reported on the firm’s balance sheet as either accounts payable or loans payable. Accounts payable are usually classified as current liabilities , while loans may be classified as either current or long-term liabilities , depending on their scheduled repayment dates. Senior creditor. Junior creditor.

Accounts Payable 40

Accounts Payable Accounts Payable Collections Accounting 40

Accounting Tools

NOVEMBER 4, 2023

A credit facility is a preapproved loan that can be drawn down at need. In addition, the bank charges interest on all loaned funds, which is typically set at a level a few percentage points above the current prime rate. The rate charged will depend on the bank’s evaluation of the ability of the borrower to pay back the loan.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

MAY 21, 2023

Related Courses Corporate Finance Crowdfunding What is a Demand Loan? A demand loan is a borrowing instrument that allows the lender to recall a loan on short notice. Once notified, the borrower must repay the full amount of the loan and any associated interest. An example of a demand loan is an overdraft arrangement.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

JULY 17, 2023

A mortgage is a loan that is used to pay for a portion of the price of real estate. The loan typically requires a fixed schedule of repayments. The underlying real estate is used as collateral on the loan. The most common mortgage is the fixed-rate variety, which locks in a fixed interest rate for the life of the loan.

Corporate Finance 40

Corporate Finance 40

Accounting Tools

APRIL 7, 2024

Lenders Lenders want to know if a business can pay for outstanding loans , and whether they have sufficient collateral to support the loans. Based on their review of a borrower's financial statements, they may call a loan or be willing to extend additional funds. Related Article Internal Users of Accounting Information

Financial Statements 40

Financial Statements Billing Accounting Accounting 40

Accounting Tools

DECEMBER 23, 2023

Any type of payment that is in arrears is certainly a sign of financial difficulty that a creditor or investor should be wary of, but a continuing pattern of payments in arrears will likely trigger some sort of restrictive action, such as calling a loan early, an increase in the interest rate charged, or a reduction in credit.

Accounts Payable 40

Accounts Payable Accounts Payable Bookkeeping Financial Statements 40

Accounting Tools

AUGUST 23, 2023

Related Courses The Balance Sheet What is a Mortgage Loan Payable? A mortgage loan payable is a liability account that contains the unpaid principal balance for a mortgage.

Accounting 40

Accounting Accounting 40

Accounting Tools

JULY 27, 2023

A security interest is a lien on an asset that has been pledged as collateral on a loan by a borrower. The lender can use this security interest to claim the asset if the borrower defaults on a loan agreement, thereby paying off the loan. The proceeds are then used to pay off the loan. Related Articles Debt Financing

Corporate Finance 40

Corporate Finance 40

Accounting Tools

OCTOBER 24, 2023

Related Courses How to Audit Payroll Optimal Accounting for Payroll Payroll Management An advance paid to an employee is essentially a short-term loan from the employer. Related Articles Payroll Accounting Payroll Entries As such, it is recorded as a current asset in the company's balance sheet.

Payroll 75

Payroll Auditing Accounting Accounting 75

Accounting Tools

AUGUST 1, 2023

Related Courses Bookkeeper Education Bundle Bookkeeping Guidebook What is a Loan Payment? A loan payment usually contains two parts, which are an interest payment and a principal payment. During the early years of a loan, the interest portion of this payment will be quite large.

Bookkeeping 40

Bookkeeping Auditing Accounting Accounting 40