And, unlike an S corp, shareholders in a C corporation cannot deduct business losses on their tax returns. Sole proprietorship is the simplest structure for a one-owner business, giving the owner few regulatory burdens and a high degree of control and flexibility. Without a distinct business entity, however, there’s no legal difference between the business’s…
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Instead, it records transactions only when it either pays out or receives cash. Variable wage expenses fluctuate due to the amount of work or number of hours completed by the employee, whereas fixed-salary expenses remain consistent from month to month. The debit entry for the wages expense account is this account itself. However, the credit…
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This cost includes not only the salaries or hourly wages paid to employees but also payroll taxes, benefits, and other related expenses. Typically, the accounting for wages expense account involves recording these expenses as a part of a single account. Accrued income is listed in the asset section of the balance sheet because it represents…
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Sum-of-years-digits is a spent depreciation method that results in a more accelerated write-off than the straight-line method, and typically also more accelerated than the declining balance method. Under this method, the annual depreciation is determined by multiplying the depreciable cost by a schedule of fractions. Since double-declining-balance depreciation does not always depreciate an asset fully…
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Luckily, another factor comes into play that can somehow level the playing field. The articles and research support materials available on this site are educational and are not intended to be investment or tax advice. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. It is…
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Analysts evaluate the risk investments hold and determine the interest rate and credit limit or loan terms for a borrower. They use their research to ensure the borrower receives an affordable loan and the lender is protected if the borrower defaults. A credit analyst usually has at least a bachelor’s degree, with a background in…
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The use of purchase discounts is a common accounting practice that can be beneficial for both parties involved in a transaction. While purchase discounts can be useful for sellers, they can also be an expensive form of funding for customers. Therefore, customers must carefully consider the cost of taking advantage of purchase discounts before deciding…
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This discount requires a company to settle its obligation before a specific date or time. Any purchase discounts received for quick payment will reduce the cost of our Inventory. Merchandise Inventory-Tablet Computers increases (debit) in the amount of $4,020 (67 × $60). Accounts Payable also increases (credit) but the credit terms are a little different…
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Banks — especially major national banks — typically offer checks to their customers, but you may need to reach out to the customer service team to get the prices. A blank check often refers to a check that has been signed by an authorized check signer without completing the other information (date, payee, amount). You…
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This section includes your name and address, and occasionally your phone number. Another risk is the potential for over-withdrawal from the account, leading to significant financial loss or penalties. On the line at the bottom-right part of the check, affix our signature legibly. You must use the same signature and name as mentioned on your…
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