Basic Accounting

Many of small business owners would rather focus on making and selling their products than on keeping their books and records. However, bookkeeping is just as important as marketing and doing business. Many a great business ideas has failed due to a poor bookkeeping system. And ultimately, won’t be keeping up if money going out [...]

One of the basic gray areas we experience in distribution is the concept of cash flow. What is cash flow? The term is tossed around but rarely used precisely or discussed in a practical manner. In laymans terms, cash flow is basically the cash received (coming into the business) over a specific time period less [...]

According to American Accounting Association, Committee on Accounting Concepts and Standards, “Revenue is the monetary expression of the aggregate of products or services, transferred by an enterprise to its customers during a period of time.” Capital and revenue receipts Capital receipts of business comprise of capital contributed by partner or by the shareholders; loans ; [...]

It’s April 15th and taxes are due once again. Each year millions of small business owners go about their business without thinking about getting a system in place for tax time. Are you organized or are you sweating bullets as the deadline nears? Usually small business owners myself included have a file stuffed with receipts. [...]

Financial accounting’s focus is on the financial reports distributed to people outside of the company. The major component of financial reporting is the financial statements: income statement, balance sheet, statement of cash flows, and the statement of stockholders’ equity. The income statement indicates a company’s profitability during a specified time period such as one year, [...]

In this web article we will also discuss: 1. Nature of Reserves or Provisions 2. Differences between reserves and provisions 3. Secret Reserves Provisions are for known liability or losses, the amount of which cannot be determined with substantial accuracy. In order to ascertain, profit or loss as accurately as possible, it is necessary to [...]

“You never know what is enough unless you know what is more than enough.” This famous quote by James Agee seems very true and very realistic and the most interesting point is that this quote seems to fit into any facet of the world. We humans have a tendency to bind our thoughts and ourselves [...]

A bank statement reconciliation or “bank rec” is an important step in maintaining the accuracy of your financial records. When a bank rec is getting you down, it might help to recall this simple rule: PUT IT WHERE IT ISN’T. Here are three unrelated items to illustrate this easy-to-remember rule: Item 1. The bank statement [...]

The amount saved is set aside for any of the following five purposes: (a) for meeting future liability or loss; (b) for strengthening the financial position of the business; (c) for fulfilling some specific purpose; (d) for redeeming a liability; (e) for replacing a wasting asset. (f) There are two ways in which the amount [...]

Selling used servers and technology assets is an excellent way to raise cash and free up storage space. However, many companies make mistakes that can be very costly and time consuming. To achieve the highest payout for your technology hardware make sure that you work with an asset recovery firm that has a well established [...]