Category: Bookkeeping

Total cost of production includes the total manufacturing cost plus all additional indirect material and labor costs. Production costs include manufacturing costs as well as outside costs, such as marketing spend and office supplies. Essentially, production costs encompass all direct and indirect costs of running a business. For example, if you’re using units produced, you…

If you want to succeed, you can’t approach construction accounting from a conventional perspective. Cornerstone Construction is a full-service general contractor in Tucson, AZ that delivers the highest quality services for residential and commercial clients. As a family-owned and operated business, we are able to provide the hands-on attention to detail, customer focus and high…

We make it a point to keep current with market trends and updates so that your business can be prepared for what is to come. LUDWIG KLEWER & RUDNER PLLC provides a variety of accounting services to support your business and personal financial reporting needs. To actually be effective, your cost coding system needs to…

Learn how to build, read, and use financial statements for your business so you can make more informed decisions. Bench simplifies your small business accounting by combining intuitive software that automates the busywork with real, professional human support. The personal account includes the account of any person, such as an owner, debtor, creditor, etc. When…

When a company pays a six-month insurance premium, the company’s asset Cash is decreased and its asset Prepaid Insurance is increased. Each month, one-sixth of the premium is recorded as Insurance Expense and the balance in Prepaid Insurance is reduced. When a company borrows money from a bank, the company’s asset Cash is increased and…

This can be especially impactful from a working capital perspective, as more extended collection periods mean that companies might face difficulties in managing their short-term obligations. Industries such as banking (specifically, lending) and real estate construction usually aim for a shorter average collection period as their cash flow relies heavily on accounts receivables. On the…

On the contrary, a company with a long collection period might be offering more liberal credit terms or might not be enforcing its collections process strictly. This could indicate potential issues within the credit department that need addressing. In extreme cases, it might also signify a risky credit policy, possibly leading to increased bad debt…

A financial professional will offer guidance based on the information provided and offer a no-obligation call to better understand your situation. Our mission is to empower readers with the most factual and reliable financial information possible to help them make informed decisions for their individual needs. We follow strict ethical journalism practices, which includes presenting…

Performing regular bank reconciliations helps you stay on top of cash flow, keep organized records for tax season, and minimize the risk of fraud and theft. We’ll explore the definition of bank reconciliation, why it’s important, and a step-by-step process for performing bank reconciliations. We’ll also look at common sources of discrepancies between financial statements…

In fact, sometimes recording income as cash is received is perfectly appropriate (and less accounting hassle). Let’s dive into a few of the most common pain points nonprofits encounter with revenue recognition and discuss how to work through them. Conditional revenue refers to situations in which the contributor will only provide funding if specific conditions…