Accounting Tools

MAY 15, 2023

Related Courses Bookkeeping Guidebook How to Audit Receivables New Controller Guidebook What is the Allowance for Doubtful Accounts? The allowance for doubtful accounts is paired with and offsets accounts receivable. Actual results may vary from management’s expectations for accounts receivable collections.

Accounts Receivable 75

Accounts Receivable Accounts Receivable Account Receivables Accounting 75

Accounting Tools

JULY 13, 2023

The unadjusted trial balance is the listing of general ledger account balances at the end of a reporting period, before any adjusting entries are made to the balances to create financial statements. The unadjusted trial balance is used as the starting point for analyzing account balances and making adjusting entries.

General Ledger 74

General Ledger Financial Statements Accruals Bookkeeping 74

Accounting Tools

DECEMBER 10, 2023

What is the Accounts Receivable Turnover Ratio? Accounts receivable turnover is the number of times per year that a business collects its average accounts receivable. The accounts receivable turnover ratio can be used in the analysis of a prospective acquiree.

Accounts Receivable 40

Accounts Receivable Accounts Receivable Account Receivables Accounting 40

Accounting Tools

MAY 14, 2023

Related Courses The Balance Sheet The Interpretation of Financial Statements What is the Order of Liquidity? Thus, cash is always presented first, followed by marketable securities , then accounts receivable , then inventory , and then fixed assets. Accounts receivable. No conversion is needed.

Financial Statements 75

Financial Statements Accounts Receivable Accounts Receivable Account Receivables 75

Accounting Tools

AUGUST 6, 2023

The dual aspect concept states that every business transaction requires recordation in two different accounts. This concept is the basis of double entry accounting , which is required by all accounting frameworks in order to produce reliable financial statements.

Accruals 75

Accruals Financial Statements Bookkeeping Accounts Payable 75

Accounting Tools

MAY 21, 2023

Related Courses The Balance Sheet The Interpretation of Financial Statements What is the Statement of Financial Position? The statement of financial position is another term for the balance sheet. The statement lists the assets , liabilities , and equity of an organization as of the report date.

Financial Statements 74

Financial Statements Accounts Payable Accounts Payable Financial Reporting 74

Accounting Tools

MAY 19, 2023

Examples of Ledger Accounts Examples of ledger accounts are cash, accounts receivable, inventory, fixed assets, accounts payable accrued expenses, debt, stockholders’ equity, revenue, cost of goods sold, salaries and wages, offices expenses, depreciation, and income tax expense.

General Ledger 75

General Ledger Accounting Accounting Reconciling 75

Accounting Tools

APRIL 6, 2024

The master budget is the aggregation of all lower-level budgets produced by a company's various functional areas, and also includes budgeted financial statements , a cash forecast, and a financing plan. This is not the case for the master budget, which looks very much like a standard set of financial statements.

Budgeting 74

Budgeting Account Receivables Accounts Receivable Accounts Receivable 74

Accounting Tools

JUNE 14, 2023

This method can be considered a reasonable accounting method if the amount that is written off is an immaterial amount, since doing so has minimal impact on an entity's reported financial results, and so would not skew the decisions of a person using the company's financial statements.

Accounts Receivable 75

Accounts Receivable Accounts Receivable Account Receivables Financial Statements 75

Accounting Tools

DECEMBER 10, 2023

These estimates may not be entirely correct, and so can lead to materially inaccurate financial statements. Accrual Basis Best Practices When recording transactions using the accrual basis of accounting, be sure to fully document the reason for each adjusting entry made.

Accruals 75

Accruals Accounting Accounting Financial Statements 75

Accounting Tools

MAY 10, 2024

Related AccountingTools Courses Business Ratios Guidebook The Interpretation of Financial Statements Problems with the Asset Turnover Ratio There are several problems with the asset turnover ratio. They are as follows: Skewed by industry requirements.

Financial Statements 74

Financial Statements Account Receivables Accounts Receivable Accounts Receivable 74

Accounting Tools

FEBRUARY 11, 2024

Business transactions are events that have a monetary impact on the financial statements of an organization. When accounting for these transactions, we record numbers in two accounts, where the debit column is on the left and the credit column is on the right. What are Debits and Credits?

Accounts Payable 75

Accounts Payable Accounts Payable Account Receivables Accounts Receivable 75

Accounting Tools

APRIL 10, 2023

ABC should not record the cash receipt until May 15, nor should it reduce the related accounts receivable balance until May 15. Thus, the post dated check has no impact on the financial statements of ABC International until the date listed on the check. The check is post dated to May 15.

Deposits 75

Deposits Financial Statements Collections Account Receivables 75

Accounting Tools

JULY 8, 2023

Related Courses Accountants’ Guidebook Bookkeeping Guidebook The Balance Sheet What are Contra Accounts? A contra account offsets the balance in another, related account with which it is paired. Contra accounts appear in the financial statements directly below their paired accounts.

Accounting 75

Accounting Accounting General Ledger Account Receivables 75

Accounting Tools

JULY 14, 2023

If the loss is material, you may want to segregate it in a separate loss account, which more easily draws the attention of a reader of a company's financial statements. This net amount represents the amount of cash that management expects to realize once it collects all outstanding accounts receivable.

Account Receivables 75

Account Receivables Accounts Receivable Accounts Receivable Financial Statements 75

Accounting Tools

DECEMBER 18, 2023

Substantive testing is an audit procedure that examines the financial statements and supporting documentation to see if they contain errors. These tests are needed as evidence to support the assertion that the financial records of an entity are complete, valid, and accurate. What is Substantive Testing?

Auditing 75

Auditing Financial Statements Accounts Payable Accounts Payable 75

Accounting Tools

JUNE 14, 2023

All suspense account items should be eliminated by the end of the fiscal year. Otherwise, a company is issuing financial statements that contain unidentified transactions, and which are therefore incorrect.

Accounting 74

Accounting Accounting Accounts Payable Accounts Payable 74

Accounting Tools

JUNE 12, 2023

Once information has been recorded in a subsidiary ledger, it is periodically summarized and posted to a control account in the general ledger , which in turn is used to construct the financial statements of a company.

General Ledger 75

General Ledger Bookkeeping Financial Statements Accounts Payable 75

Accounting Tools

SEPTEMBER 29, 2023

Related Courses Business Ratios Guidebook Guide to Analytical Procedures The Interpretation of Financial Statements What is Ratio Analysis? Ratio analysis is the comparison of line items in the financial statements of a business.

Financial Statements 75

Financial Statements Financial Analysis Accounts Payable Accounts Payable 75

Accounting Tools

JUNE 8, 2023

Source documents are typically retained for use as evidence when auditors later review a company's financial statements , and need to verify that transactions have, in fact, occurred. Source documents are the physical basis upon which business transactions are recorded. For example, a company is in the consulting business.

Petty cash 75

Petty cash Invoicing Bookkeeping Reconciling 75

Accounting Tools

OCTOBER 12, 2023

The credit being extended is usually in the form of either a loan or an account receivable. In the case of an unpaid loan, credit risk can result in the loss of both interest on the debt and unpaid principal, whereas in the case of an unpaid account receivable, there is no loss of interest.

Account Receivables 75

Account Receivables Accounts Receivable Accounts Receivable Collections 75

Accounting Tools

FEBRUARY 16, 2024

The measurement can be improved by using a tight credit policy to reduce the amount of accounts receivable , a just-in-time production system to reduce inventory , and by selling off fixed assets that are rarely used. These asset reduction policies can have a negative effect on profits, however, if they adversely impact operations.

Accruals 75

Accruals Financial Statements Account Receivables Accounts Receivable 75

Accounting Tools

AUGUST 31, 2023

A key source of cash flow uncertainty is the timing of cash receipts from accounts receivable. When a business only sells to customers in excellent financial condition, the payments from them are much more likely to arrive on time.

Accruals 75

Accruals Financial Statements Accounts Payable Accounts Payable 75

Billing Platform

MARCH 1, 2025

Read on to learn more about ARPU how to calculate, what it takes to increase ARPU, its advantages and disadvantages, how ARPU trends affect financial forecasting, the relationship between ARPU and the subscription economy , ARPU and your accounts receivable reports, and the association between ARPU and revenue recognition.

Accounts Receivable 52

Accounts Receivable Accounts Receivable Account Receivables Collections 52

Billing Platform

MARCH 1, 2025

Read on to learn more about ARPU how to calculate, what it takes to increase ARPU, its advantages and disadvantages, how ARPU trends affect financial forecasting, the relationship between ARPU and the subscription economy , ARPU and your accounts receivable reports, and the association between ARPU and revenue recognition.

Accounts Receivable 52

Accounts Receivable Accounts Receivable Account Receivables Collections 52

Accounting Tools

APRIL 24, 2024

Faithful representation is the concept that financial statements be produced that accurately reflect the condition of a business. For example, if a company reports in its balance sheet that it had $1,200,000 of accounts receivable as of the end of June, then that amount should indeed have been present on that date.

Financial Statements 40

Financial Statements Financial Reporting Bookkeeping Account Receivables 40

Accounting Tools

DECEMBER 10, 2023

How to Calculate Net Operating Assets The formula to calculate net operating assets is as follows: + The total assets of a company - All liabilities - All financial assets + All financial liabilities = Net operating assets This definition shows that all finance-related items are to be extracted from assets and liabilities.

Financial Statements 40

Financial Statements Accounts Payable Accounts Payable Account Receivables 40

Accounting Tools

JULY 16, 2023

If the totals do not agree, the transaction is said to be "out of balance," and you will not be able to use the resulting information to create financial statements until the transaction has been corrected. A key reason for using double entry accounting is to be able to report assets , liabilities , and equity on the balance sheet.

Accounting 40

Accounting Accounting Bookkeeping Account Receivables 40

Accounting Tools

OCTOBER 22, 2024

For example, a subledger may contain all accounts receivable , or accounts payable , or fixed asset transactions. Depending on the type of subledger, it might contain information about transaction dates, descriptions, and amounts billed, paid, or received. Ending balance usage. Number of ledgers.

General Ledger 40

General Ledger Financial Statements Reconciling Bookkeeping 40

Accounting Tools

APRIL 21, 2023

Related Courses Business Ratios Guidebook The Income Statement The Interpretation of Financial Statements What are Net Credit Sales? Key definitions are: Sales returns. Net credit sales are those revenues generated by an entity that it allows to customers on credit , less all sales returns and sales allowances.

Financial Statements 40

Financial Statements Account Receivables Accounts Receivable Accounts Receivable 40

Accounting Tools

SEPTEMBER 28, 2023

Related Courses Business Ratios Guidebook The Interpretation of Financial Statements What is Average Net Receivables? Average net receivables is the multi-period average of accounts receivable ending balances, netted against the average allowance for doubtful accounts for the same periods.

Accounts Receivable 40

Accounts Receivable Accounts Receivable Account Receivables Reconciling 40

Accounting Tools

JULY 27, 2023

Related Courses Business Ratios Guidebook The Interpretation of Financial Statements What is the Collection Ratio? The collection ratio is the average period of time that an organization’s trade accounts receivable are outstanding.

Collections 40

Collections Accounts Receivable Accounts Receivable Account Receivables 40

Accounting Tools

JUNE 14, 2023

Related Courses Business Ratios Guidebook The Interpretation of Financial Statements What is the Acid-Test Ratio? How to Calculate the Acid-Test Ratio To calculate an organization’s acid test ratio, add together its cash, marketable securities and accounts receivable , and then divide by the total amount of current liabilities.

Account Receivables 40

Account Receivables Accounts Receivable Accounts Receivable Financial Statements 40

Accounting Tools

JULY 12, 2023

Related Courses The Income Statement The Interpretation of Financial Statements What is Net Sales? This is the primary sales figure reviewed by analysts when they examine the income statement of a business. The sales allowances account offsets and reduces gross sales.

Financial Statements 40

Financial Statements Account Receivables Accounts Receivable Accounts Receivable 40

Accounting Tools

SEPTEMBER 30, 2023

The accounting equation is as follows: Assets = Liabilities + Equity Advantages of a Double Entry System The key advantage of a double entry system is that it allows an organization to produce a full set of financial statements. The end result of these transactions is a sale of $5,000 and an increase in cash of $5,000.

Financial Statements 40

Financial Statements Accounts Receivable Accounts Receivable Account Receivables 40

Accounting Tools

JULY 31, 2023

Related Courses Bookkeeping Guidebook Credit and Collection Guidebook The Interpretation of Financial Statements What are Net Receivables? Net receivables is the amount of money owed by customers that a business expects them to actually pay.

Collections 40

Collections Accounts Receivable Accounts Receivable Account Receivables 40

Accounting Tools

JULY 12, 2023

How Accrual Accounting Works Under accrual accounting, the accountant records not only the revenues associated with a sale, but also the related expenses. By recording both amounts in the same reporting period, a firm’s financial statements provide the most accurate view of its profitability.

Accruals 40

Accruals Accounting Accounting Financial Statements 40