Search results
Results from the WOW.Com Content Network
One can define accounting as the process of systematic recording, measuring, and communicating information about financial transactions. It’s a system that provides quantitative information about a business or a person’s financial position. An even simpler definition of accounting is that it’s the process of tracking assets, liabilities ...
Modified Accelerated Cost Recovery System (MACRS) Example. Company XYZ buys office furniture (considered a 7-year property) for $10,000. According to the IRS table A-1, 7-year property is subject to 14.29% depreciation in the first year. In this situation, the depreciation expense for year 1 would be: $10,000 * 14.29% = $1,429.
Accounting conservatism, along with the other accounting conventions, provides a standardized methodology (or, more realistically, an ethical guideline) that creates reliable financial statements. In turn, accounting conservatism creates a reliable means of comparing financial results from industry to industry and from year to year. Accounting ...
Accounts receivable is the money owed to a company. Accounts payable is money the company owes to others. An easy way to remember the difference: A/R is for “received” payment and A/P is for “paying others.”. Receivables are classified as short-term assets, while payables are short term liabilities.
Accounting Profit Definition. The accounting profit definition is the revenue of a company minus the explicit costs of a company. Explicit costs are defined as operating expenses that can be ...
Tax accounting is a specialized field of accounting focusing on minimizing tax liabilities and preparing and filing tax returns. Common examples of tax accounting include preparing individual and ...
The purpose of accounting is to produce financial statements. The statements are produced during the accounting cycle, comprised of nine steps. The steps are as follows: collection and analysis ...
The plant assets definition in business accounting refers to fixed business assets that depreciate over time. Sometimes plant assets can be referred to as fixed assets. Plant assets can be any ...
Accrual accounting is the opposite of cash accounting, which recognizes economic events only when cash is exchanged. The accrual method is more common than the cash method, and the IRS often requires companies to use the accrual method when they have more than a certain level of revenues or carry inventory.
Some of the common accounting categories used in business include: Asset accounts. Liabilities accounts. Equity accounts. Revenue accounts. Expense accounts. Assets are the things that bring value ...