Accounting Tools

APRIL 14, 2024

One option is to wait for an actual employee to leave the company, and then keep the person in the payroll records for several additional pay periods , with the perpetrator intercepting the additional paychecks. A good way to detect ghost employees is to look for anyone who has few or no deductions from his or her pay.

Payroll 75

Payroll Auditing 75

Xero

MARCH 16, 2023

Don’t forget, there’s also plenty of other resources including support articles , a 24/7 payroll specialist team and webinars you can access at any time! Preparing your final pay run Before you reach your final pay run for this tax year, there are a few important tasks needed to get you there.

Payroll 203

Payroll XERO Tax Reconciling 203

Accounting Tools

MAY 12, 2024

Purchasing Cycle In the purchasing cycle, a company issues a purchase order to a supplier for goods, receives the goods, records an account payable , and pays the supplier. Also, a company issues stock to investors in exchange for periodic dividend payments and other payouts if the entity is dissolved.

Petty cash 69

Petty cash Revenue Cycle Purchase Order Accounting 69

Accounting Tools

APRIL 29, 2024

Short-term employee benefits are offered to employees within the current 12-month period. Performance pay. An accumulating compensated absence is carried forward and can be used in future periods. These benefits include absences, base pay, medical care, and performance-based pay. Nonmonetary benefits.

Payroll 40

Payroll 40

Accounting Tools

APRIL 6, 2024

Financial Statements Production A reporting group within the department creates adjusting journal entries to bring the company's initial financial results into compliance with the applicable accounting framework , writes footnotes to accompany the financial statements , and releases financials following the end of each reporting period.

Accounting 75

Accounting Accounting Financial Statements Budgeting 75

Accounting Tools

APRIL 16, 2024

Leave Books Open A common cooking the books practice is to leave the books open past the end of the month to record additional sales within the prior reporting period. Avoid Expense Recognition Another common practice is to not record expenses in the proper reporting period, even though they clearly reflect resource consumption in the period.

Auditing 74

Auditing Invoicing Accounting Accounting 74

Accounting Tools

MAY 10, 2024

Bond interest expense is the aggregate interest expense incurred during a reporting period for an organization’s bonds payable. This is the amortization of any premium or discount on issued bonds for the reporting period. For the current year, this means that the company will pay out $60,000 of interest expense to bond holders.

Corporate Finance 40

Corporate Finance Accounting Accounting 40

Accounting Tools

APRIL 28, 2024

This amount includes not only base pay, bonuses and commissions , but also all fringe benefits, such as medical insurance, life insurance, and pension payments. This is the employer’s contributions to an employee’s retirement account, or a fixed periodic payout during the retirement period. What is Salary and Fringes?

Payroll 40

Payroll Accounting Accounting 40

Accounting Tools

OCTOBER 25, 2023

Update Employee Master File The payroll clerk receives notification of changes to employee information that impact the processing of payroll, such as withholding exemptions and pay rate changes. Set Pay Period Verify that the payroll module is set for the correct pay period.

Payroll 71

Payroll Data Entry Deposits Tax 71

Accounting Tools

AUGUST 4, 2023

Materials Acquisition Under what terms does the company pay its suppliers? If the payment terms are extremely short, the business will be required to come up with the cash to pay for its materials almost at once. Production Duration The production process can tie up cash for quite a long period of time.

Cash Collection 75

Cash Collection Collections Billing Bookkeeping 75

Accounting Tools

MAY 13, 2024

Conversely, a low liability turnover ratio (usually in relation to accounts payable ) is considered good, since it implies that a company is taking the longest possible amount of time in which to pay its suppliers , and so retains its cash for a longer period of time. Examples of turnover ratios are noted below.

Accounts Payable 40

Accounts Payable Accounts Payable Accounts Receivable Accounts Receivable 40

Accounting Tools

JULY 11, 2023

Related Courses Human Resources Guidebook Optimal Accounting for Payroll Payroll Management Accrued vacation pay is the amount of vacation time that an employee has earned as per a company's employee benefit policy, but which has not yet been used or paid. This should be a roll-forward balance from the preceding period.

Accruals 75

Accruals Payroll Accounting Accounting 75

Accounting Tools

DECEMBER 20, 2023

The factor used for the present value of an annuity due can be derived from a standard table of present value factors that lays out the applicable factors in a matrix by time period and interest rate. What would it cost ABC if it were to pay the entire amount immediately, assuming an interest rate of 5%? 05]) x (1+.05) 05]) x (1+.05)

Financial Analysis 75

Financial Analysis Accounting Accounting 75

Accounting Tools

JULY 24, 2023

Asset Exceeds Capitalization Limit Companies set a capitalization limit , below which expenditures are deemed too immaterial to capitalize, as well as to maintain in the accounting records for a long period of time. Examples of Capitalization Here are several examples to illustrate the concept: A company pays $500 for a notebook computer.

Accounting 75

Accounting Accounting Computation Budgeting 75

Accounting Tools

MAY 10, 2024

Accordingly, Logger compiles $650,000 of costs on its balance sheet over the period of the project and then bills the client for the entire $700,000 fee associated with the project, recognizes the $650,000 of expenses, and recognizes a $50,000 profit. Logger’s management expects that the entire facility will be complete in just two months.

Collections 75

Collections Bookkeeping Billing Auditing 75

Accounting Tools

MAY 10, 2024

Assets can be subdivided into many accounts , depending on their nature and assumed holding periods. Includes both debt securities and equity securities, as long as they can be liquidated within a short period of time. What are Asset Accounts? Asset accounts store monetary information about a company’s resources. Bank deposits.

Petty cash 75

Petty cash Accounting Accounting Accounts Receivable 75

Accounting Tools

MARCH 12, 2024

Accrued rent income is the amount of rent that a landlord has earned in a reporting period , but which has not yet been received from the tenant. A landlord using the accrual basis of accounting should record this income, in order to recognize it in the period in which it was earned.

Accruals 40

Accruals Accounts Receivable Accounts Receivable Account Receivables 40

Accounting Tools

JANUARY 26, 2024

The matching principle requires that revenues and any related expenses be recognized together in the same reporting period. In some cases, it will be necessary to conduct a systematic allocation of a cost across multiple reporting periods, such as when the purchase cost of a fixed asset is depreciated over several years.

Accruals 75

Accruals Bookkeeping Financial Statements Invoicing 75

Accounting Tools

SEPTEMBER 20, 2023

If an entity pays less than the capitalization limit for an asset, it charges the asset to expense in the period incurred. Related Articles Capitalization of Software Development Costs Capitalized Interest The Correct Capitalization Limit

Record Keeping 75

Record Keeping Auditing Accounting Accounting 75

Accounting Tools

NOVEMBER 26, 2023

Among the more common types of payroll fraud are not paying back an advance, buddy punching, and time sheet padding. Advance Retention Fraud The most passive type of fraud is when an employee requests an advance on his pay and then never pays it back. Periodic auditing of the payroll records is needed to spot ghost employees.

Payroll 74

Payroll Deposits Auditing Accounting 74

Accounting Tools

MAY 7, 2024

Financial Statements Only Cover a Specific Period of Time A user of financial statements can gain an incorrect view of the financial results or cash flows of a business by only looking at one reporting period.

Financial Statements 75

Financial Statements Auditing Accounting Accounting 75

Accounting Tools

MARCH 8, 2024

Accrued rent expense is the amount of rent cost that has been incurred by a renter during a reporting period , but not yet paid to the landlord. If there is an accrued rent expense, it can indicate that a renter does not have sufficient cash to pay the landlord on a timely basis.

Accruals 40

Accruals Management Accounting Accounting Accounting 40

Accounting Tools

APRIL 18, 2024

Once the organization pays the income tax , the liability is eliminated. Since tax credits typically expire after a period of time, one must pay close attention to which ones are available and can be applied to an income tax payable. Any income tax payable within a longer period is instead classified as a long-term liability.

Tax 40

Tax Expense Reports Accounting Accounting 40

Accounting Tools

MARCH 3, 2024

What is the Discounted Payback Period? The discounted payback period is the period of time over which the cash flows from an investment pay back the initial investment, factoring in the time value of money. It is primarily used to calculate the projected return from a proposed capital investment opportunity.

Financial Analysis 40

Financial Analysis Budgeting 40

Counto

MAY 4, 2024

Understanding the Legal Framework Employment Contracts and Termination Clauses: Probation Periods: Typically range from three to six months, during which the terms of termination are usually more flexible. No-Pay Leave: As a last resort, employers may ask employees to take unpaid leave to reduce costs.

Tax 52

Tax Accounting Accounting 52

Accounting Tools

FEBRUARY 16, 2024

When using profitability ratios, it is best to compare a company's results for the current period to the results for the same period in the preceding year. This is used to determine the proportion of sales still available after all variable expenses to pay for fixed costs and generate a profit. These ratios are noted below.

Accruals 75

Accruals Financial Statements Accounts Receivable Accounts Receivable 75

Accounting Tools

OCTOBER 11, 2023

This is the amount of assets consumed during the measurement period. Pay employees. Requires the collection of time worked information from employees , which is then used to produce gross wage information, tax deductions, and other deductions, resulting in net pay to employees. Examples are rent expense and wages expense.

Accounting 75

Accounting Accounting Record Keeping Purchase Order 75

Accounting Tools

MAY 4, 2024

An income statement shows the profit or loss generated by a business over a specific period of time. From left to right, the template includes description line items, followed by a column containing the period totals for the account aggregations that comprise each line item. The period totals are usually for a month, quarter, or year.

Financial Statements 52

Financial Statements Tax Expense Reports Payroll 52

Accounting Tools

OCTOBER 27, 2023

Also, it merely robs results from a future period in order to make the current period look better, so it is extremely short-term in nature. These actions are taken shortly before the end of an accounting period. Cash Window Dressing Postpone paying suppliers , so that the period-end cash balance appears higher than it should be.

Accounting 75

Accounting Accounting Financial Statements Accounts Receivable 75

Accounting Tools

APRIL 24, 2024

A payer with a substantial disbursement float can use the associated cash for a longer period of time, which incrementally increases its investment income. At its most sophisticated level of usage, a company can have multiple remote bank locations set up around the country, and pay suppliers using bank accounts located the furthest from them.

Billing 40

Billing Accounting Accounting 40

Accounting Tools

APRIL 18, 2024

Based on the experience of other companies who have been subjected to this type of litigation, it is probable that Armadillo will have to pay $8 million to settle the litigation. Do not make a retroactive adjustment to an earlier period to record a loss contingency. Related Article Contingent Liability

Accounting 75

Accounting Accounting Financial Statements Auditing 75

Accounting Tools

NOVEMBER 1, 2023

Related Courses How to Audit Payroll Optimal Accounting for Payroll Payroll Management The calculation of payroll involves the determination of gross pay , followed by the subtraction of deductions and payroll taxes to arrive at net pay. Overtime in particular should be approved, since it is 50% more expensive than regular pay.

Payroll 75

Payroll Accruals Collections Tax 75

Accounting Tools

NOVEMBER 7, 2023

The company is then liable to pay the collected sales taxes to the government. When the sales taxes are due for payment, the company pays cash to the government, which eliminates its sales tax 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 12, 2023

A bad debt is a receivable that a customer will not pay. They arise when a company extends too much credit to a customer that is incapable of paying back the debt , resulting in either a delayed, reduced, or missing payment. The first situation is caused by bad internal processes or changes in the ability of a customer to pay.

Accounts Receivable 75

Accounts Receivable Accounts Receivable Account Receivables Accruals 75

Accounting Tools

APRIL 7, 2024

The debt service coverage ratio measures whether a business has sufficient cash flow to pay its debt obligations. A very high debt service coverage ratio gives a business a substantial cushion to pay for unexpected or unplanned expenditures , or if market conditions result in a significant decline in future income.

Financial Statements 40

Financial Statements Tax 40

Accounting Tools

JUNE 10, 2023

Payment terms are imposed to ensure that payments are received by suppliers within a reasonable period of time. A large customer may use its purchasing power to force a supplier to agree to terms that are more favorable to the customer, such as a longer period of time in which to pay the supplier, or relaxed rules for returning goods.

Accounting 74

Accounting Accounting Cash Collection Accounts Payable 74

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. Example of the Operating Cash Flow Ratio According to its statement of cash flows, Blitz Communications generated $2,500,000 of operating cash flow during its most recent reporting period.

Accruals 40

Accruals Financial Statements Accounting Accounting 40