Provision for bad debts
Using the example above, let’s say a company expects that 3% of net sales are not collectible. The allowance for doubtful accounts nets against the total AR presented on the balance sheet to reflect only the amount estimated to be collectible. This allowance accumulates across accounting periods and may be adjusted based on the balance […]
Understanding Retained Earnings in the Balance Sheet: Classification, Recognition, Measurement and More
As such, the expense is accumulated in a cost pool and then allocated to the units produced in the period when the expense was incurred. If not all units produced are sold in the period, this means that some of the utilities expense will be recorded as part of the inventory asset, rather than being […]
All and sundry Definition & Meaning
These examples are programmatically compiled from various online sources to illustrate current usage of the word ‘sundry.’ Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. The origin of the phrase ‘all and sundry’ goes back a long way earlier https://turbo-tax.org/ than my childhood, even though that was some […]
Understanding the Basics: Common Journal Entries in Procurement
Note that (1) the system creates the voucher for the material amount only, and (2) the posting creates two entries. One entry is to the A/P Trade account and the second is to the Use Tax Payable account for the tax amount. The Use Tax Payable account is the account that AAI PT_ _ _ […]
Liabilities Examples in Accounting
An exception to the two options above relates to current liabilities being refinanced into long-term liabilities. If there is an intent to refinance as well as evidence that refinancing has begun, the obligations will no longer be due within 12 months. Additionally, any liability that is coming due but has a corresponding long-term investment intended […]
Cost of Goods Manufactured Statement Calculation & Example
If your COGM is higher than your selling price, then you aren’t making a profit on each item sold — and this can be bad news for your business. If you don’t know how much COGM you have, you won’t be able to make informed decisions about pricing or product development. The cost of goods […]