Excess (Accelerated) Depreciation refers to the accumulated difference between accelerated depreciation claimed for tax purposes and what straight-line depreciation would have been. This excess is often recaptured and taxed as ordinary income upon a sale.
Detailed exploration of expenses in business, including types, calculations, and tax considerations.
An expense budget is a financial tool used to limit the amount anticipated as expenses to be incurred in a future period.
Comprehensive explanation of the Expense Ratio, including its role in real estate and mutual funds, calculation methods, examples, and relevance.
External documents, such as vendor invoices and canceled checks, play a crucial role in company recordkeeping due to their greater independence and verifiability compared to internal documents.
An extraordinary item is a nonrecurring occurrence that must be explained to shareholders in an annual or quarterly report. Examples include the write-off of a division, acquisition of another company, sale of a large amount of real estate, or uncovering employee fraud that negatively affects the company's financial condition.
An in-depth exploration of Fair Value, a term adopted by the Financial Accounting Standards Board (FASB) used to measure the value of assets and liabilities in an orderly transaction between market participants.
A comprehensive definition and exploration of FIFO (First In, First Out), including its applications in various fields, examples, historical context, and related terms.
Filing status for tax purposes determines which tax return form is used, based on an individual's marital status and household situation.
A comprehensive overview of Financial Accounting, its key aspects including balance sheets and income statements, differences from managerial accounting, historical context, applicability, and more.
Comprehensive guide to the Financial Accounting Standards Board (FASB), its history, role in setting Generally Accepted Accounting Principles (GAAP), and its comparison with the International Accounting Standards Board (IASB).
An in-depth exploration of financial analysis, its significance, methodologies, and applications within the context of evaluating the financial statements of a company.
An in-depth look at the financial position, detailing the status of a firm's assets, liabilities, and equity at a specific point in time.
A detailed examination of a Financial Statement, including components like Balance Sheet, Income Statement, and additional elements such as Working Capital, Net Worth, and Cash Flow.
A method of inventory valuation in which the oldest inventory items are recorded as sold first.
A comprehensive look at the Fiscal Tax Year, including its definitions, variations, and implications in accounting and taxation.
A thorough exploration of the fiscal year, including its purpose, differences from the calendar year, and its implications for businesses and governments.
A comprehensive explanation of Fixed and Variable Rate Allowances (FAVR), an allowable method for computing a business automobile mileage allowance that is not reported as wages on Form W-2. This includes a cents-per-mile rate for operating costs and a flat amount for depreciation and insurance.
Fixed Expenses are the costs in a business operation that remain the same regardless of production or sales levels. Understand their significance, types, and contrast with Variable Expenses.
Flotation cost refers to the expenses incurred by a company when issuing new stocks or bonds, including underwriting, legal, and registration fees.
Footing refers to the process of summing up a column of numbers to get a total.
Comprehensive guide to the process of expressing amounts denominated in one currency in terms of a second currency using the exchange rate between the currencies. Detailed considerations of assets, liabilities, and income statement items.
A forensic accountant combines accounting, investigative, and legal expertise to uncover and analyze financial discrepancies, fraud, and hidden assets in legal disputes.
Detailed definitions and guidelines for Form 1040, 1040A, and 1040EZ, the individual U.S. income tax returns required to report income, deductions, and credits for the previous year.
Form 1065 is utilized by partnerships and joint ventures in the United States to report financial information to the IRS. This article explores the purpose, components, filing process, and important considerations associated with Form 1065.
Detailed overview of FORM 1120, the U.S. Corporate Income Tax Return required to be filed by most domestic corporations.
An in-depth exploration of Free Cash Flow, a crucial financial metric indicating the cash a company generates after expenses, debt service, capital expenditures, and dividends.
Full costing, also known as absorption costing, is an accounting method that assigns all manufacturing costs to the product. This includes both variable and fixed costs. It contrasts with direct costing which only includes variable manufacturing costs.
A comprehensive guide on fully depreciated assets, covering depreciation, residual value, and market value as per accounting and tax laws.
Fund Accounting is a system used by nonprofit organizations, focusing on accountability over profitability. It ensures proper stewardship of financial resources in compliance with legal requirements.
Gain refers to the increase in value, measured by the difference between the adjusted tax basis and the selling price.
Gain contingency refers to a potential or pending development that may result in a future gain to the company. Conservative accounting practice dictates that gain contingencies should not be booked, though footnote disclosure of the particulars may be made.
The General Accounting Office (GAO), now known as the Government Accountability Office, is a legislative branch government agency that provides auditing, evaluation, and investigative services for the United States Congress.
The General Accounting Office (GAO), now known as the Government Accountability Office, is an independent, non-partisan agency that supports the U.S. Congress in its oversight responsibilities.
An in-depth overview of general expenses, which are costs incurred for operations beyond selling, administrative, or cost of goods sold.
Detailed Examination of the General Fund Used by Government and Government Agencies
A comprehensive examination of General Journal, its significance, structure, and role in the accounting process, covering related concepts like journal entries and specialized journals.
A detailed exploration of Generally Accepted Accounting Principles (GAAP), including definitions, historical context, applications, comparisons, and related terms.
Detailed overview of Generally Accepted Accounting Principles (GAAP), including broad guidelines, detailed procedures, and their importance in accounting practices.
The going-concern value represents the value of a company as an operating business, distinct from the value of its individual assets or liquidation value. It is crucial for business valuations and mergers and acquisitions.
Comprehensive understanding of the principles, rules, and procedures governing the accounting systems used by federal, state, and local government units.
A comprehensive overview of government enterprises, including their definition, types, examples, historical context, and implications.
Gross refers to the highest amount, as in sales or income, and also represents a quantity of merchandise amounting to 12 dozen or 144 units.
Gross earnings refer to the total amount of an employee's salary or wages before any deductions such as taxes, Social Security, and employee benefit contributions.
Gross Income refers to the total revenue from all sources before any deductions or exclusions as specified by accounting principles and the Internal Revenue Code.
Gross Margin is a financial metric that reveals the relationship between a company's sales and its cost of goods sold, offering insight into profitability.
An in-depth understanding of Gross Profit, its calculation, significance, comparison with net profit, and real-world application.
The Gross Profit Method is a system used to estimate inventory at the end of an interim period, which is essential for preparing interim statements. It is particularly useful for estimating inventory lost to calamities for insurance purposes, although it is not acceptable for annual reporting.
Gross Profit Ratio is a key metric in installment sales, relating gross profit to the contract price to determine taxable gain from periodic receipts.
Detailed definition and explanation of Gross Receipts, including its types, significance in business accounting, and its role in tax regulations.
Gross Revenue represents total sales at invoice values before any deductions such as discounts, returns, or allowances. Explore its types, significance, calculations, historical context, and related concepts in this comprehensive guide.
Guaranteed Payments for Capital are payments made to a partner by a partnership, determined without regard to partnership income, for the use of that partner's capital.
The Half-Year Convention in tax law assumes that an asset acquired at any point during the taxable year was placed in service halfway through the year.
Head of Household tax filing status for unmarried taxpayers maintaining a principal residence for a designated dependent.
Hidden Asset refers to a reserve asset whose value is understated on a company's balance sheet, either due to accounting conventions or deliberate actions of management.
The historical cost principle is a foundational accounting concept requiring assets to be recorded based on their original cost. This entry explores its application, implications, and related concepts such as stepped-up basis and market value.
Horizontal Analysis is a time series analysis technique used in financial statements to evaluate the percentage change in an account over multiple accounting periods.
A detailed exploration of house accounts, primarily managed at a firm’s main office or by an executive, distinguishing them from salesperson-handled accounts in the territory.
Hybrid Accounting Methods incorporate elements of both cash and accrual accounting to better reflect income and expenses for certain businesses and tax purposes.
An in-depth look at the concept of illegal dividends, including what they are, their legal ramifications, and how they differ from legal dividends. Also covers historical context, types, related terms, and FAQs.
Illegal income, such as proceeds of theft or embezzled funds, is considered taxable income regardless of the legitimacy of its source. This article explores what constitutes illegal income, its taxation rules, and legal precedents.
An Imprest Fund is a petty cash fund used for minor expenses, maintained at a set balance, and replenished as needed.
Income accounts in accounting track revenue and expenses, reflecting what has occurred during the accounting period that offers profit or loss as the bottom line.
A comprehensive guide to Income Accounts, including detailed information on Revenue and Expense Accounts, types, examples, historical context, and applicability in accounting.
A comprehensive overview of the Income Statement, including its components, types, special considerations, and examples.
A detailed overview of Income Tax Returns, covering Form 1040, Form 1120, and Form 1065, alongside their types, special considerations, examples, historical context, and more.
The concept of an increase in the value of an asset and its treatment under Generally Accepted Accounting Principles (GAAP), including methodologies, examples, and limitations.
Comprehensive explanation of the independence condition in auditing, its importance, guidelines, examples, and related terms.
A comprehensive definition of indirect cost in the context of manufacturing, exploring its components, applications, examples, and distinctions from direct costs.
A comprehensive examination of indirect labor, focusing on its definition, types, implications in manufacturing, and relationship with indirect costs.
Indirect Overhead refers to the overhead expenses that are not directly traceable to a specific product or service but are necessary for overall operations, such as rent, utilities, and administrative salaries.
Inflation Accounting addresses the impact of inflation on financial statements, offering a clearer view of a company's financial health. The Financial Accounting Standards Board (FASB) mandates major companies to provide supplementary information reflecting the effects of inflation.
Comprehensive explanation of Intangible Drilling and Development Costs, their components, significance in the oil and gas industry, and comparison with Tangible Drilling Costs.
Comprehensive guide on Interest Deductions covering Investment Interest, Construction Interest, Business Interest, Housing Interest, and Consumer Interest, along with their tax implications.
Interest Income refers to the earnings generated from investments or transactions that reflect the time value of money or payment for the use or deferral of money.
A detailed exploration of interim statements, including their purpose, components, and significance in financial reporting.
The International Accounting Standards Board (IASB) is a London-based privately funded organization established in 1973 to develop and promote International Financial Reporting Standards (IFRS) for general-purpose financial statements.
International Financial Reporting Standards (IFRS) are standards and interpretations adopted by the International Accounting Standards Board (IASB) to improve the comparability of financial statements across national jurisdictions, supported by the Financial Accounting Standards Board (FASB).
A detailed exposition on Inventory Certificates, which are management representations to independent auditors regarding the inventory balance on hand. This article covers methods of computation, pricing basis, and condition details.
Inventory Shortage (Shrinkage) refers to the unexplained difference in inventory between a physical count and the amount recorded, caused by factors such as theft or normal evaporation of liquids.
Detailed explanation of itemized deductions, including types, limitations, and examples.
A Job Cost Sheet details the budgeted or actual costs of materials, labor, and overhead required to produce a product. It is pivotal in job order costing systems employed by companies producing custom goods.
Comprehensive explanation of joint costs in production, their allocation methods, examples, and their relevance in various industries.
Understanding Joint Product Costs and their Allocation in Manufacturing Processes
A comprehensive guide to understanding and recording journal entries in an accounting journal, including detailed examples and explanations.
A comprehensive explanation of a journal entry, its types, significance in accounting, examples, and historical context.
A comprehensive explanation of a Journal Voucher, its importance, uses, and how it leads to a Journal Entry in accounting.
Journalize refers to the process of recording financial transactions in an accounting journal such as the General Journal.
A judgment sample in auditing involves the determination by an auditor, based on personal experience and familiarity with the client, of the number and particular items to be examined in a population, ensuring objectivity and thoroughness in testing the sampled items for accuracy.
A comprehensive explanation of the Last In, First Out method of inventory accounting, its applications, benefits, and comparisons with FIFO.
A comprehensive guide to understanding the ledger book's role in accounting, contrasting it with the journal where transactions are initially recorded.
Understanding the financial and operational implications of legacy costs, including pensions, health insurance, and other post-retirement benefits.
LIFO is an acronym for Last In, First Out, which is a method used in inventory management and accounting.
A comprehensive overview of liquid assets, highlighting their definitions, examples, importance in financial statements, and practical applications.
Detailed description of liquidating value, its calculation, distinctions from going-concern value, and its significance in business and finance.
A detailed exploration of liquidation dividends resulting from the winding up of business affairs, including settlements with debtors and creditors, and distribution to shareholders.
A comprehensive guide to Liquidity Ratio, including its importance, types, calculation methods, and applicability in assessing a firm's ability to meet short-term obligations.
Professional assistance provided by nonlawyers to lawyers in the litigation process, encompassing forensic accounting, economic determinations, expert testimony, and financial valuations.
A comprehensive overview of Long-Term Debt, its accounting and financial implications, including types, special considerations, examples, and related terms.
Long-Term Liabilities refer to any monetary obligations that are not required to be paid on demand or within one year. They are distinct from current liabilities, specifically the current portion of long-term debt.
