Category: Bookkeeping

As stated above, most financial institutions provide companies with loan repayment schedules with the breakup of periodic payments split into principal and interest payments. Sometimes, amortization also which journal entry records the amortization of an expense refers to the reduction in the value of a loan. Let us understand the journal entry to amortize goodwill…

Adjustment entries can also impact a business’s stock-based compensation expenses. Adjustment entries can impact a business’s cash flow by affecting the timing of cash inflows and outflows. For example, if an adjustment entry is made to increase accounts receivable, this will increase the amount of cash that the business expects to receive in the future.…

The largest nonprofits in the US can accumulate annual contributions totaling billions of dollars, but the statement of activities breaks the figure down into just a few lines. You can publish the statement of activities on your website, in your annual report, or share it directly with your donors and any grant-making organizations you depend…

The statement of activities quantifies the revenues and expenses of a nonprofit for a reporting period. These revenues and expenses are broken down into the “Without Donor Restrictions” and “With Donor Restrictions” classifications that were referred to earlier for the statement of financial position. Overall, significant accounting policies play a crucial role in nonprofit financial…

Their lower debt burdens and interest costs make them less financially risky in the face of declining revenues or profits. While their equity investors make lower returns in strong markets, lower leverage reduces risk of equity being wiped out in downturns. It shows investors how much debt is used to finance the business’s operations. A…

For instance, a high cost of sales may lead to a lower net profit margin, suggesting a company may not be as profitable as others in its industry, even if it is generating significant revenue. Cost of Sales is a critical figure for investors and financial analysts to consider when evaluating a company’s financial health.…

You could have one account reserved for paying expenses, another one for managing payroll, and a third one for receiving payments for clients. Whether you decide to do job costing manually or using software, the same steps apply. Job costing is a process that helps you determine the costs of working on a project. Union…

Construction jobs also run longer-term than many other businesses; some contracts can span multiple years. The company is still responsible for its accounts payable on whatever terms have been set (usually anywhere from 30 to 90 days), even if the job itself won’t be complete for another two years. Construction jobs are then doled out…

Their ability to act as a strategic partner, offering guidance and expertise, will be instrumental in navigating financial complexities and achieving long-term objectives. In this article, we explore the benefits of hiring a fractional CFO and evaluate whether it’s a wise decision for your business. We’ll delve into the cost savings they offer compared to…

Aside from production costs, other costs that may increase include rent for a warehouse, increases in salaries for employees, or higher utility rates. In finance, there are various tools and methods used for break-even analysis. Sensitivity analysis, for instance, helps professionals assess how changes in variables like selling price or production costs impact the break-even…