Bookkeeping articles

The correct answer is D. Prepaid insurance is an asset account which fluctuates on an annual basis but is never closed. The security system for this website has been triggered. Completing the challenge below proves you are a human and gives you temporary access. Learn how to write closing journal entries for revenue, expense, and […]

In contrast, intangible assets that have indefinite useful lives, such as goodwill, are generally not amortized for book purposes, according to GAAP. Remember that an intangible asset would amortize in a very similar way over time, be it intellectual property, goodwill, or another account. The IRS may require companies to apply different …

While not as common for recurring billing companies as an invoice delay, it can occur when customers manually make a payment on their accounts. Include a section on your balance sheet for unbilled receivables to recognize revenue for a given period. Count unbilled receivables toward your total revenue even if an invoice has not been […]

Unexpected expenses can crop up at any time, from critical repairs to legal settlements. And when you’re faced with these kinds of costs, your cash flow can suffer as a result. Reserve accounting can help you ensure that your business’s finances don’t need to take a hit if you ever need to deal with unplanned […]

Also termed as fictitious account relates to accounts of expenses, income and profit or losses. Many types of transactions relating to expenses( wages, salary, rent etc), discount, income and commission are carried in a business. Therefore, the rule becomes debit all expenses and losses while credit all incomes and gains. Posting accounting …

It’s usually listed at the top of your bank statement as to how much is left in your account. You may not even need to calculate to know your banking closing balance. A banking closing balance is the positive or negative amount you see in your bank balance at the end …