Kategori: Bookkeeping

By setting clear expectations and accountability, businesses can foster a secure outsourcing relationship that protects their financial data effectively. Outsourcing providers often implement best practices and internal controls that align with industry standards and regulations. This includes adherence to frameworks such as the Sarbanes-Oxley Act (SOX), which mandates accurate financial reporting and internal controls to…

Assets might lose value more rapidly at the start or end of their useful life. May overstate depreciation expenses in early years and understate in later years. The straight-line method ignores variations in an asset’s usage, which can affect its value. Unlike a truck or computer, there’s a direct correlation to the productivity of this…

The inherent uncertainty as to the amount of cash that will actually be received affects the physical recording process. To illustrate, assume that a company makes sales on account to one hundred different customers late in Year One for $1,000 each. The earning process is substantially complete at the time of sale and the amount…

Over time, retained earnings can have a significant impact on a company’s growth and profitability. The dotted red box in the shareholders’ equity section on the balance sheet is where the retained earnings line item is recorded. Yes, a balance sheet company can have negative retained earnings or an accumulated deficit. Negative retained earnings mean…