Category: Bookkeeping

The primary aim of the double-entry system is to keep track of debits and credits and ensure that the sum of these always matches up to the company assets, a calculation carried out by the accounting equation. It is used to transfer totals from books of prime entry into the nominal ledger. Every transaction is…

Part of the period end bookkeeping process is to reconcile the balance on the accounts payable control account in the general ledger to the total of the balances each of the supplier accounts in the subsidiary ledger. If the balances do not agree then it means there must be an error in one or both…

A higher payout ratio results in higher estimated dividends, potentially increasing the stock’s valuation. However, ensuring the company can sustain its dividend payments is crucial to avoid potential dividend cuts or financial distress. Several considerations go into interpreting the dividend payout ratio—most importantly the company’s level of maturity. Investors use the ratio to gauge whether…

For example, it may also contain details like a reference number or activity type for each transaction. Creating the right structure in your accounting system means that you can track the sales and costs of specific products. You’ll be able to track inventory and suppliers and monitor anything else that can help you make informed…

Keep all relevant financial documents organized, including receipts, invoices, and other supporting records. Consult a tax professional familiar with real estate to maximize deductions and minimize tax liabilities. The terms “bookkeeping” https://www.bookstime.com/real-estate-bookkeeping and “accounting” are often used interchangeably, but when it comes to maintaining your real estate business, they’re typically used to describe entirely different…

Your tenants receive polite late payment reminders and you don’t have to lift a finger. A real estate account takes responsibility for the financial aspects of the buying, selling, leasing, and renting of real estate properties. Also known as property accountants, this position also plays an important role for preparing documents for tax season. Like…

Gross income refers to the total earnings of an employee before any deductions. However, the employee’s take-home pay, also known as net pay, is the amount left after all deductions have been accounted for. For example, an employee with an annual salary of $90,000 who gets paid over 24 pay periods would have a gross…

Unfortunately, this practice can occasionally cause confusion within the financial industry as multiple numerical abbreviations are used interchangeably within society. The term “MM” originates from the Roman numeral M, which stands for one thousand. It is commonly used in financial documents, accounting, and stock market where space is a concern. The finance term MM, denoting…

In the first case, the firm receives a total face value of $5,000 and ultimately repays principal and interest of $5,200. Interest expense is not debited because interest is a function of time. The discount simply represents the total potential interest expense to be incurred if the note remains’ unpaid for the full 120 days.…

Automated expense management systems offer you real-time data on employee spending across organizations. View each department, category, project, and employee expense data under one dashboard. Choose an expense management system that allows you to add and customize approval workflows that suits your organization. A well-defined workflow will ensure the employees’ expense reports reach the right…