What are the options to pay yourself as a business owner? Making money and earning a living from your business is great. After all, that’s probably one of the main reasons for setting it up in the first place. But as a small business owner, how do you go about actually paying yourself? And what …
Before you can set a price for any item you manufacture, you must calculate the per-unit manufacturing cost. This product cost calculation includes elements such as the cost of raw materials, direct labor, and overhead costs. The price you set determines your profit margin. Define Total Manufacturing Cost The accounting and business term, total manufacturing cost, also called cost …
When a small business extends credit to customers, inevitability some portion of those transactions will turn into bad debt since the recovery of bad debts in most cases is unlikely, even when threatening to report to a collection agency. As a result, a bookkeeping entry must be prepared to adjust the balance sheet and income statement. Preparing and …
How to Create a Bad Debt Write Off Journal Entry Read More »
When preparing financial statements, a trial balance is used as part of the closing process to develop the balance sheet, income statement and statement of cash flows. After an adjusted trial balance is prepared, a post closing trial balance is used to verify the accuracy of the closing process. This type of trial balance is helpful when ensuring the completeness of financial …
When recording journal entries for the cost of goods sold, accountants work in tandem with manufacturing or operations to ensure they’re booking the correct costs. Support from production personnel is essential to back-up journal entries and remain compliant with U.S. GAAP. These points and those below are part of the inventory cost recordation process. What is Cost of …
How to Record a Journal Entry for Cost of Goods Sold Read More »