Tag: Accounting
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Bookkeeping – Franchise Fee and Revenue Taxes (Lesson 57)
This lesson focuses on the accounting procedure for franchise fees and the formula used for revenue taxes. What is interesting is that in some states, one affects the other.
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Bookkeeping – Meals Tax (Lesson 56)
A major source of local government revenue is the meals tax. Most states authorize the right of local governments to raise revenues utilizing a meals tax.
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Bookkeeping – Suspense Accounts (Lesson 55)
When bookkeepers face an unknown variable with a transaction and don’t know where to place the debit or credit, they use a temporary account to hold the value. This is called the ‘Suspense’ account.
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Bookkeeping – Loan Accounting (Lesson 54)
Almost every small business borrows money. The most common reason is to purchase a fixed asset of some sort. The amount borrowed is most often a long-term liability.
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Bookkeeping – Amortization (Lesson 53)
Amortization is similar to depreciation whereby an asset’s cost is allocated to the expense over time. There are several differences with amortization. Amortization is used with intangible assets and the method is almost always straight line.
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Bookkeeping – Book and Tax Depreciation (Lesson 52)
One of the differences between book income and taxable income is depreciation. In general Section 168 of the Internal Revenue Code allows businesses to accelerate their depreciation for tax purposes.
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Bookkeeping – Depreciation Schedules (Lesson 51)
When a small business purchases fixed assets two financially based opposing forces come into play. The first is the financial reporting desire to present information in a fair manner so management can make good financial decisions. The opposing force has to do with taxation.
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Bookkeeping – Introduction to Depreciation (Lesson 50)
Depreciation is the process of allocating the initial capital outlay for fixed asset purchases over time to the income statement. The basic principle with depreciation is that any fixed asset has a predetermined lifetime based on time, usage or fair market value.
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Bookkeeping – Fixed Asset Purchases (Lesson 49)
Every now and then management authorizes the purchase of a long-term producing asset. This could be a vehicle, piece of equipment or real estate. These purchases are referred to as fixed assets.
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Bookkeeping – Controlling Cash (Lesson 48)
In small business, cash is almost always the number one issue. There is simply never enough. This is primarily attributable to growth. Growth requires both physical assets to produce more and expansion of accounts receivable. Technically, the expansion of accounts receivable is the economic equivalent of lending cash.