Occasional accounting reconciliations mean that account balances in the company system can be matched up with balances in independent accounts such as credit customers, suppliers, and banks. •Require computer users to have tight control over storage of programs and data.
These systems must ensure that the reports are timely so that …
In contrast, intangible assets that have indefinite useful lives, such as goodwill, are generally not amortized for book purposes, according to GAAP. Remember that an intangible asset would amortize in a very similar way over time, be it intellectual property, goodwill, or another account. The IRS may require companies to apply different …
If a company uses standard full-cost transfers, it can substantially reduce the variation in price the buying unit receives. This approach makes it possible to measure more precisely each unit’s contribution, especially when variances are charged to the unit responsible for them. It also makes it possible to more clearly separate the …
In turn, this meant that the shareholders received fewer credits along with their dividends, meaning in turn that they had to pay more tax. The credit is equal to the amount of the dividend multiplied by the company tax rate and then divided by the difference between the tax rate and 100.
This would be a significant loss of revenue for the …
While not as common for recurring billing companies as an invoice delay, it can occur when customers manually make a payment on their accounts. Include a section on your balance sheet for unbilled receivables to recognize revenue for a given period. Count unbilled receivables toward your total revenue even if an invoice has not been […]
Direct labor costs include the labor costs of all employees actually working on materials to convert them into finished goods. As with direct material costs, direct labor costs of a product include only those labor costs clearly traceable to, or readily identifiable with, the finished product.
Inspection of incoming raw materials and …