Author: David J Hoare MSA
-
Profit Standards for Residential Contractors
Profit standards for residential contractors vary depending on the type of contractor. In general, the net profit standard for contractors in the upper tier of performance range from 5.8% to as high as 9.6% of sales.
-
Constructive Dividends – Definition, Understanding and Application
When a corporation confers an economic benefit upon a shareholder, in his capacity as such, without an expectation of reimbursement, that economic benefit becomes a constructive dividend, taxable as such. See INTERNAL REVENUE SERVICE NATIONAL OFFICE FIELD SERVICE ADVICE MEMORANDUM FOR DISTRICT COUNSEL, Number 200011003 dated October 27, 1999; specifically Page 4, 3rd paragraph.
-
Lien – Simple, Business and Legal Definitions
A documented right to property owned by a debtor and granted to a creditor is referred to as a ‘lien’. Although relatively a simple definition, it gets much more complicated when used in various contexts.
-
Bookkeeping – Controls in Accounting (Lesson 95)
Just as manufacturing uses controls to ensure quality of product, controls are used in accounting to generate accurate information, maintain security over assets and comply with Generally Accepted Accounting Standards.
-
Bookkeeping – Employer Provided Vehicle (Lesson 94)
With small business it is very common to provide a vehicle to the owner and key employees. It is often done in the construction industry and transportation sector. The idea is to provide transportation for not only the convenience of the employer but as retention tool for employees.
-
Bookkeeping – Other Employer Provided Benefits (Lesson 93)
Other employer provided benefits are composed of three groupings of benefits: welfare, other (Life Insurance, Auto & Education) and fringe.
-
Bookkeeping – Cafeteria Plans (Lesson 92)
Cafeteria plans, a.k.a. Section 125 plans, are employer sponsored benefit packages that allow employees to choose from a menu of options and allocate their allotted share to the items they pick. With this type of plan the employer agrees to an allowance per employee to contribute to the package. The employee may either take the allowance as…
-
Bookkeeping – Health Savings, Reimbursement and Flexible Spending Accounts (Lesson 91)
One of the drawbacks to the health insurance mandate for small business employers is the cost of the premium for the plan. To alleviate and reduce the cost of these premiums, employers provide alternatives in the form of health savings, reimbursement and flexible spending accounts.
-
Bookkeeping – Employer Provided Retirement Plans (Lesson 90)
For the longest time a retirement plan was the most important employee benefit to offer. Today it is number two behind health insurance which is mandated by law. Still, it is a sought after benefit by employees and an excellent recruitment and retention tool for employers. There are two broad groups of retirement plans.
-
Bookkeeping – Employee Health Insurance Mandate (Lesson 89)
After three decades of discussion, in-fighting and wrangling, Congress passed a health insurance mandate along party lines of vote. This health insurance mandate changed the rules for employers and affects the accounting department and in particular, the proper bookkeeping for the respective amounts paid by both the employer and employee.