Category: <span>Bookkeeping</span>

WIP inventory directly affects Cost of Goods Sold (COGS) and overall profitability. The terms ‘work in process’ and ‘work in progress’ are frequently used interchangeably, yet they can mean different things depending on the business. Let’s see if you’ve fundamentally understood what work in process inventory is. Accounting for WIP Inventory in the Balance Sheet...

NRV is used in the United States and internationally under different accounting rules. NRV prevents the overstatement of asset values because it represents their true value, which ensures accurate accounting and reporting. NRR is a key indicator of a company’s growth, profitability, and how well it’s increasing its overall value. With rising customer acquisition costs...

The inventory (asset) will decrease by $250 and a cost of sale (expense) will be recorded. (Note that, as above, the adjustment to the inventory and cost of sales figures may be made at the year-end through an adjustment to the closing stock but has been illustrated below for completeness). After six months, Speakers, Inc....

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In the interim, the business could have been mistakenly spending money it didn’t have. Single-entry bookkeeping is what you do in your checkbook, recording checks and deposits in one register. For businesses using single-entry, you record income and expenses once, hence the name. Single-entry accounting is only practical single entry bookkeeping vs double entry for...

In simple terms, gross profit margin shows the money a company makes after accounting for its business costs. This metric is usually expressed as a percentage of sales, also known as the gross margin ratio. A typical profit margin falls between 5% and 10%, but it varies widely by industry. It is similar to gross...

If the IRS determines that the deduction you claimed is illegitimate, you’ll have to pay the IRS $1200. That’s $1000 to make up the difference, and $200 for the penalty. The penalty is typically 20% of the difference between what you should have paid and what you actually paid in income tax. If there are...

The AALTCI says only 19% of LTC insurance claims begin before a person is 75 years old. It’s wise to buy long-term care insurance before your 50s, so you can have it in place if you need long-term care. Long-term care insurance can be expensive, but that’s because long-term care, like nursing homes and assisted...

The company may also face higher borrowing costs due to perceived risks, compounding the financial strain. In severe cases, the lack of financial solvency can lead to insolvency proceedings, such as bankruptcy, which signals to the market that the company is not a viable entity. When analyzing the role solvency plays in a company, it’s...

Many organizations implement computerized maintenance management system (CMMS) software to manage maintenance on their equipment and facility assets. CMMS software stores all maintenance data in one spot, allowing maintenance professionals to easily create and manage work orders, view asset history, track demand for spare parts, and much more. Activities include assembly, setup, testing, inspecting, and...