Conversely, solvency delves into a company’s long-term obligation mentality and the sustainability of its ongoing operations. Therefore, solvency remains a fundamental pillar of financial stability, outlining a company’s ability to manage immediate commitments and navigate long-term financial commitments reliably. Don’t just look at one ratio from one period; most financial ratios are able to tell […]

On the other hand, VAT tends to be regressive; that is, it takes proportionately greater amounts from those with lower incomes. Also, the cascading tax is harmful to new and marginal business activities, likely to set off inflationary tendencies, and is detrimental to exports. For more information about or to do calculations involving VAT, please […]

Similarly, if a company has a very high current ratio compared with its peer group, it indicates that management may not be using its assets efficiently. The short answer is that you won’t unless you compare your company’s current ratio against a company in the same industry. If you own a sporting goods company, you […]

Accountants record and analyze financial transactions, including sales, purchases, investments, and more, to understand a business’s financial status. Finance Accounting jobs involve accurate calculations and processing of financial data, statements, and reports. The data is crucial and vital since it is related to the financial stability of the company and is shared with the stakeholders. […]

Pat makes most sales using a mobile debit or credit card reader, but many customers prefer to buy in cash. Pat uses a tablet-based digital cash register to track cash-based sales to understand which products are performing well and how many were sold. If you sell goods that you have produced through your manufacturing division, […]

We now close the Distributions account to Retained Earnings. Distributions has a debit balance so we credit the account to close it. Our debit, reducing the balance in the account, is Retained Earnings. Often confused with income statements, the two are very different and should not be interpreted as being the other. The key similarity […]

Since we credited income summary in Step 1 for $5,300 and debited income summary for $5,050 in Step 2, the balance in the income summary account is now a credit of $250. While these accounts remain on the books, their balance is reset to zero each month, which is done using closing entries. Prepare the […]

If you use different QuickBooks features and services, you can set them up again to manage your books. Enter your login information and follow the on-screen prompts to set up the second company. This means each Company you’ll create will have its own subscription. Step 3: Go through your QuickBooks Online setup checklist There, we’ll […]

Some companies may choose to always depreciate an asset to $0 because its salvage value is so minimal. In general, the salvage value is important because it will be the carrying value of the asset on a company’s books after depreciation has been fully expensed. It is based on the value a company expects to […]

Once enrolled, your Account must remain in good standing with a deposit and spending history that meets our discretionary requirements to maintain access to the feature. BalanceUp overdraft limits of $20-$200 are provided at our sole discretion, and may be revoked any time, with or without notice. 3 The Annual Percentage Yield (“APY”) for the […]