It is a contractual agreement between a borrower and a lender, wherein the borrower agrees to pay back the loan in accordance with the terms of the loan agreement. ‘Interest on loan’ account is debited in the journal entry for loan payment. Company ABC has borrowed loan $ 100,000 from the bank with an interest […]
Category Archives: Bookkeeping
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But that potential challenge also presents an opportunity for firm leaders to create positive outcomes by reevaluating and adjusting their goals, creating a new plan of attack and executing their strategies. This period of COVID-19 presents a unique challenge for accounting firms and their clients, many of whom are grappling with how to survive when […]
Similarly, if the firm decides to increase its output to OQ3 to meet further rise in demand technical progress may have advanced to such a level that it installs the plant with the LAC3 curve. Now it produces OQ3output at a still lower cost OC3 per unit. If the minimum points, L, M and N […]
Note that whether or not you sign up for overdraft protection, your bank might still allow payments to go through when you’re short of cash (and charge you insufficient funds fees). Automatic recurring payments, such as utility payments or insurance premiums, will most likely be paid even if you’ve asked your bank to decline transactions […]
We can make the journal entry for loan payable by debiting the cash account and crediting the loan payable account. A loan receivable is the amount of money owed from a debtor to a creditor (typically a bank or credit union). Common examples of unsecured loans include credit cards and personal loans. When the company […]
Home valuations can help you make an educated guess about the amount of property taxes you’ll pay each year. And they can affect whether you’ll be able to get a mortgage on a home you’ve bid on. They may decide to go with the first appraisal if it’s not drastically off. Additional appraisals also require […]
Companies should estimate a total amount of bad debt at the beginning of every year to help them budget for that year and account for non-collectible receivables. The accounts receivable account is credited, while the bad debt expense account is deducted. Whether bad debt expense is an operating expense is a contentious issue, and whether […]
Since businesses add net income to retained earnings each accounting period, they directly impact shareholders’ equity. Dividends are a company’s distribution of revenue back to the shareholders. Companies may offer a dividend reinvestment program (DRIP) for shareholders to reinvest the dividends back into company stock, usually at a discount. Profit, on the other hand, is […]
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