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Category Archives: Bookkeeping

Is Prepaid Rent a Current Asset? Is It Debit or Credit

Read­ing Time: 5 minutesThe appro­pri­ate account­ing treat­ment for pre­paid rent and rent expense may vary depend­ing on the company’s spe­cif­ic cir­cum­stances and the rent­al agreement’s terms. The effect of these entries is also recor­ded in the company’s income state­ment and the bal­ance sheet. In the peri­od when pre­paid pre­paid rent assets or liab­il­it­ies rent is paid but not due, there will be no record in the income state­ment. There­fore, it ful­fills the defin­i­tion of the cur­rent assets and is recor­ded under the head of cur­rent assets on the…

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Difference between Intangible and Tangible Assets

Read­ing Time: 3 minutesA music pro­duc­tion com­pany might own the rights to songs, which means that whenev­er a song is played or sold, rev­en­ue is earned. Although these assets have no phys­ic­al prop­er­ties, they provide a future fin­an­cial bene­fit for the music com­pany and the music­al artist. Fur­ther­more, intan­gible things are often dif­fi­cult to quanti­fy or meas­ure. Key Dif­fer­ences in Depre­ci­ation and Amort­iz­a­tion Assets such as prop­erty, plant, and equip­ment are tan­gible assets. Tan­gible assets form the back­bone of a com­pany’s busi­ness by provid­ing the means by which…

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Calendar Year Examples, Definition, Tools, Importance, Uses

Read­ing Time: 5 minutesAny cal­en­dar that fol­lows an astro­nom­ic­al year must have a sys­tem of inter­cal­a­tion such as leap years. A cal­en­dar year is defined as the peri­od begin­ning on Janu­ary 1 and end­ing on Decem­ber 31, com­pris­ing 12 months accord­ing to the Gregori­an cal­en­dar. This setup aligns with the Earth’s jour­ney around the Sun, thereby organ­iz­ing and sim­pli­fy­ing annu­al plan­ning and events. The IRS requires busi­nesses to file their taxes on the 15th day of the third month after the end of their fisc­al year. So if…

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2 6: Under- or Over-applied Overhead Business LibreTexts

Read­ing Time: 5 minutesOth­er examples of actu­al man­u­fac­tur­ing over­head costs include fact­ory util­it­ies, machine main­ten­ance, and fact­ory super­visor salar­ies. Applied over­head is the amount of actu­al over­head that has been applied to goods pro­duced. This is typ­ic­ally achieved with a stand­ard over­head rate that is cal­cu­lated once a year (or some­what more fre­quently). Based on these estim­ates, the budget­ing team estab­lishes a stand­ard over­head rate of $10 per unit pro­duced. By the end of the year, only 95,000 units were pro­duced, so the amount of applied over­head was…

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What Does an Accountant Do? Roles, Skills, Qualifications

Read­ing Time: 3 minutesIt var­ies depend­ing on the exact role, level of exper­i­ence, and loc­a­tion. The medi­an salary for all account­ants and aud­it­ors was $77,250 in May 2021, accord­ing to BLS. But the earn­ing poten­tial could be https://www.bookstime.com/ much high­er depend­ing on the spe­cif­ics of an accountant’s role. What Is an Account­ing Degree? Cer­ti­fic­a­tions like Cer­ti­fied Pub­lic Account­ant (CPA) or Cer­ti­fied Man­age­ment Account­ant (CMA) are valu­able in advan­cing an account­ant’s career. Account­ants handle everything from payroll pro­cessing and book­keep­ing to fin­an­cial fore­cast­ing and audit­ing. Estab­lish rela­tion­ships with local…

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