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What is the necessary expense rule three-part test is intended to?
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∙ 6y ago
justify the purpose of an expenditure
Nadia Heidenreich
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What is the justification for debiting rent expence?
We debiting the rent expense because when expenses are incurred so the rule of double entry is to debit the expense account and increased liability....it is rules of GAAP.
Are wage expense considered a current liability?
Generally NO, wages are an expense. The only exception to the rule is if a company has "wages payable" which is wages that they owe but have not yet paid, "wages payable" is a liability until they are paid. Once paid, the account is closed into wage expense and is listed under the asset column of the Trial Balance sheet, until the end of the accounting cycle when expense accounts are closed out for the year end.
Is expense account a debit or credit account?
Expense account is a debit account. So for example the expense is rent paid, so every year the rent expense increases and we record it in the debit side of the rent payable account and to complete the double entry, credit the same amount to the profit and loss account. Follow this basic rule to know which side your looking for: DAXP (debit side items), LICS (credit side items) D: drawings A:assets X:expenses P:purchases, L:liabilities I:income C:capital S:sales. So DAXP items increase in the debit side while LICS items increase in the credit side.
When is it necessary to report income tax losses?
As a general rule it is a good idea to report all income tax gains or losses. Contact a accountant to find out more about what you need to do for your specific situation.
How long do you need to keep income tax papers?
For most items of income and expense, three years is the normal rule. However, for any item, such as depreciation on assets which can be claimed in excess of the normal three years, you will want to keep your papers for as long as you are claiming the asset. Papers relating to your cost, or cost basis, in capital assets should be kept forever and handed down to whoever will inherit these assets from you.
What is the necessary expense rule three-part test intended to do?
justify the purpose of an expenditure
What is the the necessary expense rule three part test is intended to do?
justify the purpose of an expenditure
What concept was developed by the GAO to apply reasonable discretion an flexibilty?
necessary expense rule
What is the three-part test of that helps to justify the purpose of expenditures?
necessary expense rule
The three part test of what helps to justify the purpose of expenditures?
necessary expense rule
What The three-part test of the helps to justify the purpose of expenditures.?
necessary expense rule
What is three part test of the helps to justify the purpose of expenditures?
necessary expense rule
What is the three part test that helps to justify the purpose of expenditures?
necessary expense rule
What three part test did Government Accountability Office develope?
Necessary Expense Rule
What is the three part test to help to justify the purpose of expenditures?
necessary expense rule
What concept was developed by the gao to apply reasonable discretion and flexibility?
Necessary Expense Rule
What three part test did the Government Accountability Office develop?
Necessary Expense Rule
