Archivio Categoria: Bookkeeping

A company, ABC Co., receives a bank statement from one of its banks stating the balance in the bank account to be $2,650. On the other hand, the bank balance in the bank book of the company is $3,200. Since both balances are different, bank reconciliation should be prepared. Since the company has already obtained […]

Costs are often underestimated, resulting in cost overrun during execution. When a transaction takes place, it typically involves both private costs and external costs. My Accounting Course  is a world-class educational resource developed by experts to simplify accounting, finance, & investment analysis topics, so students and professionals can learn and propel their careers. Supply is […]

An indirect cost is a cost that cannot be identified with specific segments of operations. Period costs are expensed during the time period in which they are incurred. They are costs that are treated as expenses of the period in which the costs are incurred. Cost can be defined as the amount (measured in terms […]

If the bicycle manufacturer was trying to choose between making bicycles and skateboards, the opportunity cost of making bicycles would be the revenue they could receive from making skateboards instead. Whenever you choose to spend money on a good or a service, you’re also choosing not to spend that money on something else. Opportunity cost […]

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Non-operating expenses are separate from operating expenses from an accounting perspective so as to be able to determine how much a company earns from its core activities. Variable expenses are important for businesses to track because they can have a major impact on profits. Meaning businesses can become significantly more or less profitable with minor […]

As the company sells more products, the cost of goods sold increases. For example, if you are paying too much rent on office space or buying supplies in bulk that are never used up before they expire, these costs will add up over time and hurt the bottom line of your company’s profits. Usually, the […]

For example, if a business owner schedules a carpet cleaner to clean the carpets in the office, a company using the cash basis records the expense when it pays the invoice. Under the accrual method, the business accountant would record the carpet cleaning expense when the company receives the service. Expenses are generally recorded on […]

To meet this heavy expense the ministers had to devise all sorts of expedients to raise money. But the price of artistic freedom comes at the expense of professional protection. It will make markets and the capitalist system function better by rewarding positive contributions to well-being and prosperity, not wealth transfers at the expense of […]

Non-operating expenses are separate from operating expenses from an accounting perspective so as to be able to determine how much a company earns from its core activities. Variable expenses are important for businesses to track because they can have a major impact on profits. Meaning businesses can become significantly more or less profitable with minor […]