Now, every business has its own chart of accounts that depends on the industry they are a part of and the financial activities they lead. T accounts are used in a bookkeeping method known as double-entry bookkeeping. Before diving into why T accounts are used in accounting, let’s kick things off with some basic accounting [...]

There is also such a thing as negative brand equity, which is when people will pay more for a generic or store-brand product than they will for a particular brand name. Negative brand equity is rare and can occur because of bad publicity, such as a product recall or a disaster. Home equity is often [...]

In the U.S., only businesses in certain states have to collect sales tax, and rates vary. The Small Business Administration has a guide to help you figure out if you need to collect sales tax, what to do if you’re an online business and how to get a sales tax permit. For example, if a [...]

Small businesses commonly use three-digit numbers, while large businesses use four-digit numbers to allow room for additional numbers as the business grows. Advisory services provided by Carbon Collective Investment LLC (“Carbon Collective"), an SEC-registered investment adviser. Liabilities are debts and obligations of the business they represent as creditor's claim on business assets. Liabilities in financial [...]

It allows companies to record their sales and credit purchases in the same reporting period when the transactions occur. Also called accrued liabilities, these expenses are realized on a company's balance sheet and are usually current liabilities. Accrued liabilities are adjusted and recognized on the balance sheet at the end of each accounting period. Any [...]

This entry removes the liability since the utility bill is paid in cash. For companies that are responsible for external reporting, accrued expenses play a big part in wrapping up month-end, quarter-end, or fiscal year-end processes. A company usually does not book accrued expenses during the month; instead, accrued expenses are booked during the close [...]

They help determine if there is a strain on the assets of a firm or if the firm is highly in debt. The management will need to immediately address and rectify the situation to avoid liquidation in the future. The analysis of a financial statement is made possible by the use of financial ratios. So [...]

Accountants can help businesses identify opportunities to automate financial processes, such as invoicing, payroll, and expense tracking. Mergers, acquisitions, and business restructuring involve combining, acquiring, or reorganizing businesses to improve their overall performance, increase market share, or achieve strategic goals. By analyzing these metrics, the business can identify trends and implement strategies to optimize its [...]

An accountant can compile and analyze the data, helping the company to identify the most cost-effective marketing strategies. These reports can highlight critical financial and operational data, enabling business owners to make well-informed decisions. This not only helps businesses save money but also ensures they remain compliant with tax laws. By analyzing financial statements and [...]

If the work is adequate, and the practice sees there’s more slack to be picked up, it can expand the contract to more hours. This way, costly overestimations of time can be avoided, and the practice can test the bookkeeping professional before wholly committing. If you are a dental professional with taxable income, it is [...]