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How to Retail Inventory
Accounting for merchandise inventory has its frustrating moments, but it’s easier than accounting for manufacturing inventory. A merchandising company such as a retail store has only one class of inventory [more…]
How to Handle Markups and Markdowns in Accounting
You may get quite a thrill when you’re out shopping and you see something fantastic on the discount rack. When you see it, you probably think, “Ching-ching, I just scored!” However, have you ever thought [more…]
How to Use Perpetual and Periodic Inventory Methods
Two major types of inventory systems exist: perpetual and periodic. Larger retailers have electronic cash registers (ECRs). If you’ve ever used the self-checkout, you’ve used one. The checkout features [more…]
What Constitutes Accounts Payable (A/P)?
Accounts payable includes money a company owes it vendors for services and products that it has purchased in the normal course of business and anticipates paying back in the short term. [more…]
What Are Contingencies in Accounting Terms?
Contingencies exist when a company has an existing circumstance as of the date of the financial statements that may cause a gain or loss in the future, depending on events that haven’t yet happened and [more…]
The Dark Side of Debt-Free
Finally, that wonderful day comes when the debt is paid off. You may not think of it as a thorny accounting situation — and it isn’t, as long as the debt is held to maturity. In other words, there’s no [more…]
Types of Dividends
Dividends are distributions of company earnings to the shareholders. They can be in the form of cash, stock, or property. Most unrelated investors (not directly involved with the day-to-day operations [more…]
Financial Income versus Taxable Income
In addition to using different standards for financial income (also known as book income) versus taxable income, the entities and individuals interested in financial accounting and taxable income are different [more…]
Temporary Differences in Tax Accounting
Temporary differences occur because financial accounting and tax accounting rules are somewhat inconsistent when determining when to record some items of revenue and expense. Because of these inconsistencies [more…]
Take Advantage of Net Operating Losses
It’s a fact of life in the business fast lane that companies don’t always have more revenue than expenses every year. It’s not necessarily a bad thing, and it can happen for many reasons, including moving [more…]
The Difference between Costs and Expenses
What’s a cost and what’s an expense? Consider an example. Assume that Penway Manufacturing, Inc., makes toasters and needs to buy some new metal fabrication machines to form the outer shell of the toaster [more…]
Depreciation Methods
Depreciation is the method of allocating costs to the appropriate period. Although accountants have to follow generally accepted accounting principles [more…]
What Is an Asset Impairment?
An impairment loss takes place when a company makes the judgment call that the carrying value of an asset on the company balance sheet is less than fair value, [more…]
How to Control Your Business Cash
Bookkeeping is all about keeping tabs on where your business’s cash is. Here are a few handy tips that will ensure that your bookkeeping doesn’t require too much red ink so your small business can thrive [more…]
Must Know Formulas for Cost Accounting
To reduce and eliminate costs in a business, you need to know the formulas that are most often used in cost accounting. When you understand and use these foundational formulas, you’ll be able to analyze [more…]
Important Terms and Principles Cost Accountants Should Know
Many accountants will tell you that cost accounting is the most difficult accounting subject to learn. That's because cost accounting has many terms that are not used in other areas of accounting [more…]
Avoiding Pitfalls on Cost Accounting Exams
Cost accounting is a great tool to improve the profitability in any business. It’s a critical subject that accounting students need to learn to be successful in their careers. However, some cost accounting [more…]
Key Costs Related to Managerial Accounting
In accounting, a cost measures how much you pay/sacrifice for something. Managerial accounting must give managers accurate cost information relevant to their management decisions. Here are several cost-related [more…]
Ten Key Accounting Terms
Knowing when to use the correct term and what it means can make a world of difference when you decipher financial statements and reports and determine profits and losses. It's easy to get debits and credits [more…]
Accounting Tips for Business Managers
A good part of Accounting For Dummies focuses on the needs of business managers for truly useful accounting information. Here are some useful tips to keep in mind: [more…]
Corporate Finance and the Role of Money in the World
Corporate finance is the study of relationships between groups of people that quantifies the otherwise immeasurable. Take a look at the role of money in the world to understand how this definition makes [more…]
What Makes Corporate Finance Unique
Corporate finance plays a very interesting role in all societies. Finance is the study of relationships between people: how they distribute themselves and their resources, place value on things, and exchange [more…]
How Corporate Finance Rules Your Life
Unless you’re in a rare minority who live “off the grid” (secluded and self-sufficient), nearly every aspect of your life is strongly influenced, directly or otherwise, by corporate finances. The price [more…]
What Exactly Are Corporations?
Corporations are a special type of organization wherein the people who have ownership can transfer their shares of ownership to other individuals without having to legally reorganize the company. This [more…]
What Are Depository Institutions?
Depository institutions come in several different types. Anytime you give your money to someone with the expectation that the person will hold it for you and give it back when you request it, you’re either [more…]
