Regular audits of the inventory are carried out to check the frequency of stock-outs of different items. Advanced modelling tools and frameworks are used to determine the economic order quantity that will minimize the stock out and also the inventory carrying cost. A shortage of working capital may limit the value of orders that can be placed each month. This could be caused by poor cash flow management or other inventory issues such as too much cash (more…) […]
The members of the credit unions are the ones that own accounts in the institution; hence, the depositors are also partial owners and receive dividends. A depository allows traders and investors to hold securities in dematerialized form; thus, eliminating the risk related to holding physical financial securities. The buyers and sellers now do not need to check whether the securities have been transferred successfully without any loss or theft. The depository system reduces such risks by allowin […]
All acquisitions of raw materials are recorded in a raw materials control account when purchased. Additionally, it needs reliable suppliers that can always deliver parts quickly, and the ability to efficiently assemble machines that put together its vehicles. Other methods for eliminating waste and saving storage costs is by using dropshipping or consignment inventory. You can compare these two inventory models and see what might work for your business so you can focus on growing sales. The pro […]
When a company uses the weighted-average method and prices are rising, its cost of goods sold is less than that obtained under LIFO, but more than that obtained under FIFO. Inventory is not as understated as under LIFO, but it is not as up-to-date as under FIFO. A company can manipulate income under the weighted-average costing method by buying or failing to buy goods near year-end. However, the averaging process reduces the effects of buying or not buying. An inventory valuation allows a compa […]
Deposits listed on the cutoff statement to deposits in the cash receipts journal. Remember that tracing means that you’re going up from the source documents to the accounting records and you’re testing for completeness. By tracing from the cutoff statement you’re confirming that all checks sent out by the company were recorded (making sure they’re not understating their expenses). Deposits recorded in the cash receipts journal after year-end to the cutoff statement. Inst […]
Have they extended that evaluation period out to the reasonable period of time? Have they included all relevant information that’s available at that date? Remember, management’s evaluation is valid at the point at which they make that evaluation based on known information. For this reasonable period of time, management is required to identify whether any conditions or events are present when they’re making this evaluation that may cause significant doubt with respect to the ab […]
However, if Mr. A, owner of ABC Company, buys a car for personal use using his own money, that transaction is not recorded in the company’s accounting system because it clearly is not a transaction of the company. Hence, the income should be recognized in December 2020 even if it has not yet been collected as of that date.
Or maybe you’ve planned for a hurricane for your location that’s on the coast, but didn’t have plans further inland where storm damage could be more […]
A temporary difference results when a revenue or expense enters book income in one period but affects taxable income in a different period. A temporary difference is expected to reverse in the future and therefore results in the creation of a DTL or DTA. The following are some examples of temporary differences and DTL/DTA created. A permanent difference will cause a difference between the statutory tax rate and (more…) […]
In New Jersey, an accounting and finance firm wanted an accountant to maintain client records and help reconcile expense discrepancies. Qualifications included one or more years experience and a bachelor’s degree in accounting.
Finance is the study and management of money, investments, and other financial instruments. Certified Internal Auditor is a certification offered to accountants who conduct internal audits. A Master of Public Administration is a degree in public affairs that prepa […]
Current market value or exit value is the amount of cash that may be obtained at the balance sheet date by selling the asset in an orderly liquidation. Net realizable value is the amount of cash that can be obtained as a result of future sale of an asset. Present value is the expected exit value discounted to the balance sheet date. A certified financial statement is a financial reporting document that has been audited and signed off on by an accountant. For this reason the numbers reported in […]
