The burn rate doesn’t breakdown expenses and qualify them individually, either. A business owner might know their burn rate is troubling, but that won’t help them figure out where spending could be cut, how profits could be increased, or where alternate funding could be found. Part of the beauty of most SaaS businesses is that […]
Petty cash can also work for frequent but mundane expenses, like milk for the office fridge, stamps, or cleaning supplies. Based on the information above, fill out the fields to record the expense. Go back to the Chart of Accounts screen and look for Petty Cash Account. On the far right of the column, click […]
However, all owner’s withdrawals are subject to federal, state, and local income taxes and self-employment taxes (Social Security and Medicare). Similarly, these draws do not affect the net income of the company, as they are a reduction of the company’s capital and not an expense for tax accounting purposes. When paying yourself as a business […]
Noncurrent assets refer to assets and property owned by a business that are not easily converted to cash and include long-term investments, deferred charges, intangible assets, and fixed assets. In this journal entry, the depreciation expense is an income statement item while the accumulated depreciation is a contra account to the fixed asset on the […]
Chief Accounting Officers must be able to break down complex data into meaningful insights and have an analytical approach when identifying trends. They must interpret information accurately and make sound decisions based on their analysis. It means knowing how to read financial statements to quickly spot possible risks or opportunities in the company’s operations. Accountants […]
New assets are typically more valuable than older ones for a number of reasons. Depreciation measures the value an asset loses over time—directly from ongoing use through wear and tear and indirectly from the introduction of new product models and factors like inflation. Writing off only a portion of the cost each year, rather than […]
Accruing payroll also helps businesses manage their cash flow, comply with accounting standards, and improve employee satisfaction. Properly accounting for accrued payroll can help businesses maintain accurate financial records, avoid errors or discrepancies in payroll, and ensure that employees are paid accurately and on time. This check may be paid through the corporate accounts payable […]