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Financial Statements
A financial statement is a record of the financial activities of a person or business entity where all related financial information are presented in an orderly manner and can be easily understood.
5,583 Questions
Debiting the Projects expenses once they are approved and before they are paid or accrued violates all Accounting standards and distorts Financial reporting .The NFP Organization may keep track of projects Payments through budgeted Accounts in its Accounting System.
What are the journal entry on purchase of software?
Debit software purchase account
Credit cash / bank
Can a firm with positive net income run out of cash?
Yes. If the company has debt service (principal payments on loans) that exceed the cash generated from operations, it could also run out of cash. Also, if the company is spending cash on other assets, such as machinery and equipment, or building up inventories, they could be profitable and still run out of cash.
Accrued rent expense is a liability?
Accrued rent expense is classified as an Expense. It's not classified as a liability. Expenses are paid out of "Revenue" and they affect "Retained Earnings". When you do a Trial Balance before closing out your accounts, Expenses are actually listed with Assets, because all "Expenses" contain a debit balance.
There is only one reason an expense would be listed as a liability and that is if you post the transaction before paying it and then the account "Expense Payable" is used and is a liability as it is a "Payable" and actually is not listed with the term "expense" in it. For example if you have Rent Expense, then the two accounts used are Rent Expense and Rent Payable. Notice the "liability" account is actually titled "rent payable" not "rent expense".
The term accrued is merely the term used in Accrual Accounting, which simply means that all transactions are recorded as they occur or "accrue" as opposed to cash basis accounting where transactions are recorded only when cash is paid out or received.
In actuality if you are trying to classify your accounts, such as the question, classify the following accounts as either an Asset, Liability or Owners Equity Account, Expenses will be classified as an Owners Equity Account as they affect Retained Earnings, which in turn affects Owners Equity (stockholders equity).
I'm not awre of any convention, however, it is probably being done since its immaterial. As a general rule, one need not concern oneself with errors that are immaterial both individually, and in aggregate.
How does loss on disposal of fixed asset affect income statement?
The returns from the deal will expand (charge) cash or other resource account. Contingent upon whether a misfortune or gain on removal was understood, a misfortune on removal is charged or an addition on removal is credited. The misfortune or gain is accounted for on the pay explanation. The misfortune diminishes pay, while the addition expands it.
Are bonds assets or liabilities?
If bonds of any other company purchased then it is asset of company while if bonds are issued to other investors then it is liability of the company.
What is the purpose of the statement of cash flow?
Well first of all cash flow/ cash gifting is illegal because once you go an pay you are getting money from a source that no one really knows. You can be getting it from drugs, printing, or just people are doing something where they are trying to get rid of stolen or illegally earned money.
What is the difference between cost accountant and financial accountant?
DISTNGUISH between finance, management accountant and financial accounting
What is financial concurrence?
Financial concurrence means expressing an opinion on the financial expenditure including its implications on the organisatin
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What are the differences between accounting system and accounting information system?
accounting is a interesting field and it is a business transaction and preparation financial statements and accounting information system it is a system of information provides.because of information provides the management can control a business. writer, sakibrubel
What is debbi fields net worth?
As of 2014, Debbi Fields net worth is approximately $65 million dollars. Debbi Fields is best known as the founder of the cookie company called Mrs. Fields Bakeries.
If you have financial liability, they you have to pay money if something goes wrong. Liability means you can be held responsible and financial means money.
What is journal of written off entry for preliminary expenses?
[Debit] Amortization of Prelimenary expenses xxxx
[Credit] Preliminary expenses xxxx
preliminary expenses are amortized in equal amount intil it is fully write off.
Where does income tax liability go on the cash flow statement?
income tax liability is not part of cash flow statement rather it is part of balance sheet.
What is the role of the Financial Accounting Foundation?
It is responsible for selecting members of the FASB, raising money to fund the FASB's operations, and providing general oversight of the FASB to assure that it is performing its mission
Why do employees need accounting information?
employees need accounting information to analyze the profit so as to determine their part of bonus and further identify the health of the corporation where they work.
Is cash a part of income statement?
Cash is a current asset of business and all assets and liabilities are shown under balance sheet and are part of balance sheet and not of income statement so cash is shown under current asset portion of asset side of balance sheet.
Engineering expenses attributable solely to a contract are an example of indirect or direct costs?
Direct labor costs
What kind of financial instrument is the carry of an asset?
Investments often lead to a big expense and are therefore recognized in the balance sheet of a company. Investments (assets) often lead to (annual) depreciation costs such as the carry of an asset.
