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A journal entry is the act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company's debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit. The total of the debits must equal the ...
The leasing company setting the residual values (RVs) will use their own historical information to insert the adjustment factors within the calculation to set the end value being the residual value. In accounting, the residual value could be defined as an estimated amount that an entity can obtain when disposing of an asset after its useful ...
An asset depreciation at 15% per year over 20 years. In accountancy, depreciation is a term that refers to two aspects of the same concept: first, an actual reduction in the fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wears, and second, the allocation in accounting statements of the original cost of the assets to periods in which the ...
The basis value is the price of the fixed asset. Tax on recapture is calculated by = (BookValue – BasisValue) x TR Capital gains tax = (BasisValue – Salvage Value) x TR/2 Disposal tax effect (DTE) = (tax on recapture + Capital gains tax) If a company sells an asset for less than the tax basis this causes a loss in capital.
A general journal is a daybook or subsidiary journal in which transactions relating to adjustment entries, opening stock, depreciation, accounting errors etc. are recorded. The source documents for general journal entries may be journal vouchers, copies of management reports and invoices.
Double entry Accounting is achieved by: Debit – debtors account with value of sales (increasing a current asset) Credit – sales account with total amount (increasing income) Choose credit sales journal if this stock is then on-sold to customers who will pay later. The people/organizations here are known as debtors.
An asset's initial book value is its actual cash value or its acquisition cost. Cash assets are recorded or "booked" at actual cash value. Assets such as buildings, land and equipment are valued based on their acquisition cost, which includes the actual cash cost of the asset plus certain costs tied to the purchase of the asset, such as broker fees.
A = Capital recovery (amortization) factor F = Sinking fund amortization factor I = Investment S = Estimated salvage value = Operating expense stream d = CCA rate per year for tax purposes t = rate of taxation n = number of years i = cost of capital, rate of interest, or minimum rate of return (whichever is most relevant) and where