{ "_full_id": "http://www.translatoruser-int.com/bizfluent.com/how-6472551-calculate-inventory-shrinkage.html", "_id": "bizfluent.com/how-6472551-calculate-inventory-shrinkage.html", "_last_studio_import": "2019-09-20T17:53:46.984000", "_last_updated": "2019-09-20T17:53:46.984000", "_type": "document", "_url": "https://bizfluent.com/how-6472551-calculate-inventory-shrinkage.html", "ancestor_categories": [ { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/accounting/", "_id": "bizfluent.com/accounting/", "_type": "document", "_url": "http://bizfluent.com/accounting/", "ancestor_categories": [ "bizfluent.com/", "bizfluent.com/finance-your-business/" ], "external_url": "bizfluent.com/accounting/", "id": "bizfluent.com/accounting/", "parent_category": "bizfluent.com/finance-your-business/", "pub_date": "2019-09-04T08:47:30.035000", "title": "Accounting", "type": "sub-category", "url": "/accounting/" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/finance-your-business/", "_id": "bizfluent.com/finance-your-business/", "_type": "document", "_url": "http://bizfluent.com/finance-your-business/", "ancestor_categories": [ "bizfluent.com/" ], "external_url": "bizfluent.com/finance-your-business/", "id": "bizfluent.com/finance-your-business/", "parent_category": "bizfluent.com/", "pub_date": "2019-09-04T08:46:07.200000", "title": "Finance Your Business", "type": "category", "url": "/finance-your-business/" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/", "_id": "bizfluent.com/", "_type": "document", "_url": "http://bizfluent.com/", "external_url": "bizfluent.com/", "id": "bizfluent.com/", "pub_date": "2000-04-21T00:00:00", "type": "home", "url": "/" } ], "asset_meta": { "count": { "reference": 2, "reference_link": 2, "resource": 0, "resource_link": 0, "section": 1, "section_headline": 0, "step": 5, "step_headline": 0, "step_image": 0, "things_needed": 1, "tip": 0, "warning": 0, "word_detail": 181, "word_summary": 83 } }, "content": "Calculator Check your company's records to determine the value of inventory that you should have in stock based on prior inventory totals and the value of goods sold. This is the book value. For example, your records may show that you should have $5,000 in inventory because you had $6,000 worth of inventory, sold $2,000 and bought $1,000 more. Total the actual value of inventory that you have in stock. This number may be different than the book value because of losses, damaged goods or theft. Subtract the actual amount of inventory from the amount that you should have according to your financial records. For example, if you expected to have $5,000 but only had $4,850, you would subtract $4,850 from $5,000 to get $150. Divide the difference from Step 3 by the amount you should have to calculate the shrinkage rate. In this example, you would divide $150 by $5,000 to get 0.03. Multiply the shrinkage rate by 100 to convert to a percentage. Finishing this example, you would multiply 0.03 by 100 to determine a shrinkage rate of 3 percent. ", "content_origin": "legacy", "content_type": "Freestyle", "culture": "en-US", "description": "How to Calculate Inventory Shrinkage. Inventory shrinkage refers to the loss of inventory due to a variety of factors, including theft and damage. Knowing the shrinkage rate can help you determine whether you could be more profitable by limiting inventory losses. High rates of shrinkage mean that you are losing a lot of inventory that you are not being reimbursed for. In order to calculate shrinkage, you need to know how much inventory you expect to have and the actual amount of inventory that you have in stock.", "documents": [ { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/determine-startup-costs-nonprofit-5933.html", "_id": "bizfluent.com/determine-startup-costs-nonprofit-5933.html", "_last_studio_import": "2014-08-13T06:39:20.362000", "_last_updated": "2017-11-21T21:09:29.979000", "_type": "document", "_url": "http://bizfluent.com/determine-startup-costs-nonprofit-5933.html", "ad_category": [ "business_finance", "economy" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "Starting a nonprofit organization requires taking a good look at your projected operational costs and your potential fund-raising income before you offer your services to the public. 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"http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ci/63/list-operating-costs-business-800x800.jpg", "height": 363, "thumbnail_url": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/i.ehow.com/images/a07/ci/63/list-operating-costs-business-180x180.jpg", "url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ci/63/list-operating-costs-business-800x800.jpg", "validated_image": true, "width": 330 }, "keywords": "non-profit organization non-profits starting a non-profit charitable organizations", "last_studio_import": "2014-08-13T06:39:20.362000", "last_updated": "2017-11-21T21:09:29.979000", "level": 2, "old_fixed_category": [ { "_id": "/nonprofit/", "external_url": "/nonprofit/", "title": "Nonprofit", "url": "/nonprofit/" } ], "original_published_date": "2008-10-14T13:41:56", "owning_domain": "bizfluent.com", "parent_category": "bizfluent.com/accounting/", "pub_date": "2008-10-14T13:41:56", "publisher_id": 4546427, "readability": "10", "related_content_rcp": [ { 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Contributions on Schedule C?", "url": "bizfluent.com/info-7967945-can-charitable-contributions-schedule-c.html" }, { "_id": "bizfluent.com/how-6047803-fashion-show-sponsors.html", "external_url": "bizfluent.com/how-6047803-fashion-show-sponsors.html", "image_url": "http://photos.demandstudios.com/getty/article/142/205/98199205.jpg", "title": "How to Get Fashion Show Sponsors", "url": "bizfluent.com/how-6047803-fashion-show-sponsors.html" } ], "repurposed_from": [ "www.ehow.com" ], "sections": [ { "steps": [ { "content": "Determine all of your monthly fixed costs. Include the amounts for rent or mortgage payments, heat, signage, electricity, Internet and telephone service. Ask the previous tenant for copies of heating and electricity bills to get an idea how much you need to budget for fixed costs." }, { "content": "Decide if you will hire paid employees or use volunteers. If you will hire employees, determine how much money you will pay them. If your employees will be paid on an hourly basis, you are required to pay them for any overtime hours worked." }, { "content": "Add the fees you will have to pay to open your nonprofit organization. You\u2019ll need to file an application with the Internal Revenue Service to be declared a 501(c)(3) organization. Section 501(c)(3) is a tax law provision that recognizes your group as a nonprofit organization and exempts you from paying federal income tax. You still have to pay employment tax and other federal taxes. You may also need to pay local zoning and permit fees if you plan to renovate your office space." }, { "content": "Include costs for contracted services. Look at things such as trash removal, maintenance, cleaning, lawn care and legal and accounting services. Even if you plan to handle your organization\u2019s finances yourself, it may be worthwhile to consult an accountant on an occasional basis." }, { "content": "Find out how much insurance will cost, both for your building and vehicles and for any services that you may offer. If you will be hiring paid employees, determine how much it costs to provide health insurance coverage." }, { "content": "Investigate how much a computer network will cost. Include computers, printers, modems, routers and any wiring needed. Don\u2019t forget to include the cost of a support contract. Sooner or later, something will go wrong with your computer system, and it makes financial sense to have a contract in place. Don't forget about the cost of office equipment, such as copiers and postage meters." }, { "content": "Prepare an advertising and fund-raising budget. You need to let people know that you have started your nonprofit and need to solicit donations. Smaller newspapers offer less-expensive ad rates, although they also reach fewer people than the major newspapers. Decide if costly TV and radio advertising is within your reach. Add the cost of Web design if you plan to pay someone to prepare a website for your organization. If you plan on hiring a fund-raising consultant, include these costs." }, { "content": "Make a rough estimate of fund-raising income, but be prepared to operate with little income until your group is more established. Decide if you will obtain funding by holding special events, sending out fun-raising appeals, applying for grants or directly approaching potential donors." }, { "content": "Factor in the cost of vehicles and insurance if you will be using organization-owned vehicles. Include a provision for gas reimbursement for employees or board members who will use their personal cars for organization business." } ] } ], "studio_article_id": 89973, "studio_id": "8bb6b982-8195-43a4-8d12-7583035cba3d", "summary": "Starting a nonprofit organization requires taking a good look at your projected operational costs and your potential fund-raising income before you offer your services to the public. Knowing what to expect financially before you start your organization is the key to long-term success. Potential donors are more likely to donate to a group that appears to be well-run and organized. A sound fiscal basis and detailed planning is the key to ensuring your nonprofit\u2019s future.", "thumbnail": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ci/63/list-operating-costs-business-800x800.jpg", "title": "How to Determine Start-Up Costs for a Non-Profit", "title_id": 2535426, "type": "Article", "url": "/determine-startup-costs-nonprofit-5933.html", "writer": "www.demandstudios.com/contributor/22fef120-7a02-4be4-a3a7-f5f31ef42277" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/low-budget-outreach-ideas-5884.html", "_id": "bizfluent.com/low-budget-outreach-ideas-5884.html", "_last_studio_import": "2014-08-28T17:04:15.379000", "_last_updated": "2017-11-21T21:09:30.084000", "_type": "document", "_url": "http://bizfluent.com/low-budget-outreach-ideas-5884.html", "ad_category": [ "food_drink", "food", "candy_sweets" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "Outreach activities bring a church group into the heart of a community. Outreaches are simply churches helping others outside the four walls of the church. A church on a limited budget can participate in outreach by choosing service types of outreaches. An outreach that serves people in the community is called \"servanthood evangelism.\"", "editor": "www.demandstudios.com/contributor/193cec47-ebf1-47eb-bd07-cc5ba8d3543f", "external_url": "bizfluent.com/low-budget-outreach-ideas-5884.html", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Topic View", "id": "bizfluent.com/low-budget-outreach-ideas-5884.html", "image": { "_id": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/ci/24/outreach-project-ideas-1.1-800x800.jpg", "caption": "Outreach projects can include neighborhood cleanup.", "credit": "Rake Art. image by bluefern from Fotolia.com", "external_url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/ci/24/outreach-project-ideas-1.1-800x800.jpg", "height": 283, "thumbnail_url": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/i.ehow.com/images/a06/ci/24/outreach-project-ideas-1.1-180x180.jpg", "url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/ci/24/outreach-project-ideas-1.1-800x800.jpg", "validated_image": true, "width": 424 }, "keywords": [ "cheap outreach ideas", "low cost outreach ideas", "inexpensive outreach ideas" ], "last_studio_import": "2014-08-28T17:04:15.379000", "last_updated": "2017-11-21T21:09:30.084000", "level": 2, "old_fixed_category": [ { "_id": "/nonprofit/", "external_url": "/nonprofit/", "title": "Nonprofit", "url": "/nonprofit/" } ], "original_published_date": "2010-01-12T02:21:50", "owning_domain": "bizfluent.com", "parent_category": "bizfluent.com/accounting/", "pub_date": "2010-01-12T02:21:50", "publisher_id": 5860048, "readability": "9", "references": [ { "_id": "http://www.metroministries.com/worlds_largest_sidewalk_sunday_school.php", "external_url": "http://www.metroministries.com/worlds_largest_sidewalk_sunday_school.php", "title": "Metro Ministries", "url": "http://www.metroministries.com/worlds_largest_sidewalk_sunday_school.php" } ], "related_content_rcp": [ { "_id": "bizfluent.com/outreach-ideas-senior-citizens-11051.html", "external_url": "bizfluent.com/outreach-ideas-senior-citizens-11051.html", "image_url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/getty/article/151/2/86536288_XS.jpg", "title": "Outreach Ideas for Senior Citizens", "url": "bizfluent.com/outreach-ideas-senior-citizens-11051.html" }, { "_id": "bizfluent.com/ideas-transplant-fundraiser-5515.html", "external_url": "bizfluent.com/ideas-transplant-fundraiser-5515.html", "image_url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "title": "Ideas for a Transplant Fundraiser", "url": "bizfluent.com/ideas-transplant-fundraiser-5515.html" }, { "_id": 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"https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/8936007757f24cc490f9e73d78449662.jpg", "title": "6 Offsite Outing Ideas to Boost Team Synergy", "url": "bizfluent.com/13721506/6-offsite-outing-ideas-to-boost-team-synergy" } ], "repurposed_from": [ "www.ehow.com" ], "sections": [ { "steps": [ { "content": "Provide yard maintenance to some of the elderly and handicapped citizens of your neighborhood or community. Volunteers can bring their own lawn equipment and offer their time to work on these projects. The leader would need to bring water to keep volunteers hydrated and garbage bags to remove trash. During the winter, outreach workers could bring their own shovels and clean off sidewalks and driveways for the elderly. The leader could provide hot coffee and doughnuts before and after the event." } ], "title": "Yard Work" }, { "steps": [ { "content": "Low-cost seasonal ideas like gift-wrapping services are fun outreaches. Parents who do not enjoy gift-wrapping can bring their gifts and wrapping supplies to a wrapping station, where volunteers will gift-wrap for them. Alternatively, the outreach ministry could purchase inexpensive wrapping paper and supplies. Wrapping paper workers would volunteer their time. At Easter, an outreach could be an inexpensive egg hunt using plastic eggs and donated candy." } ], "title": "Seasonal Outreaches" }, { "steps": [ { "content": "Take your outreach team into the business field. Offer to bag groceries for free at your local grocery store. Tell volunteers to be polite, smile and thank the customer for shopping at the store. Another outreach would be cleaning the parking lot of a business near your center or church. Community trash pickups are worthy outreaches that require little except willing volunteers." } ], "title": "Business Outreaches" }, { "steps": [ { "content": "Outreach volunteers should give bottles of water away on hot summer days. Take your outreach team to a four-way stop or red light and give away bottles of water to thirsty drivers. Hold up signs that say \u201cFree Water.\u201d The cost of this outreach would be the cost of ice for the water and the water bottles." } ], "title": "Water Giveaways" }, { "steps": [ { "content": "Take outreach volunteers into a needy community and hold a sidewalk Sunday school. Volunteers gather children together in a yard after meeting parents and guardians. They then share a Bible story, sing songs and play some games. This low-cost outreach needs only an illustrated Bible and some candy. The outreach workers may want to bring blankets or towels for everyone to sit on together." } ], "title": "Sidewalk Sunday School" } ], "studio_article_id": 1121101, "studio_id": "37c77b70-7cdf-4d23-9967-1d8b5255513e", "summary": "Outreach activities bring a church group into the heart of a community. Outreaches are simply churches helping others outside the four walls of the church. A church on a limited budget can participate in outreach by choosing service types of outreaches. An outreach that serves people in the community is called \"servanthood evangelism.\"", "summary_is_first_section": true, "thumbnail": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/ci/24/outreach-project-ideas-1.1-800x800.jpg", "title": "Low-Budget Outreach Ideas", "title_id": 3978244, "type": "Article", "url": "/low-budget-outreach-ideas-5884.html", "widget_stats": { "thumb": { "-1": 0, "1": 5 } }, "writer": "www.demandstudios.com/contributor/42cfa95a-a5d3-4d8d-8d86-86d3faebb5a5" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/conduct-membership-drive-5789.html", "_id": "bizfluent.com/conduct-membership-drive-5789.html", "_last_updated": "2017-10-03T22:10:15.066000", "_type": "document", "_url": "http://bizfluent.com/conduct-membership-drive-5789.html", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "ContributerNoProfile", "content_type": "TopicView", "culture": "en-US", "description": "Membership drives are useful for expanding an organization or simply increasing the name recognition of an organization. And they are used by all types of organizations. Here are some guidelines any group can follow.", "external_url": "bizfluent.com/conduct-membership-drive-5789.html", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Topic View", "id": "bizfluent.com/conduct-membership-drive-5789.html", "image": { "_id": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/06/og/conduct-membership-drive-800x800.jpg", "caption": "Every organization needs a membership drive.", "credit": "organizer image by Anton Gvozdikov from Fotolia.com", "external_url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/06/og/conduct-membership-drive-800x800.jpg", "height": 282, "thumbnail_url": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/i.ehow.com/images/a06/06/og/conduct-membership-drive-180x180.jpg", "url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/06/og/conduct-membership-drive-800x800.jpg", "validated_image": true, "width": 425 }, "last_updated": "2017-10-03T22:10:15.066000", "level": 2, "old_fixed_category": [ { "_id": "/nonprofit/", "external_url": "/nonprofit/", "title": "Nonprofit", "url": "/nonprofit/" } ], "original_published_date": "2010-04-14T23:36:41", "owning_domain": "bizfluent.com", "parent_category": "bizfluent.com/accounting/", "pub_date": "2010-04-14T23:36:41", "publisher_id": 6298384, "readability": "13", "references": [ { "title": "\"Organizational Behavior\"; Timothy A. Judge; Prentice Hall, 2008", "type": "Unknown" } ], "related_content_rcp": [ { "_id": "bizfluent.com/membership-drive-ideas-organizations-5231.html", "external_url": "bizfluent.com/membership-drive-ideas-organizations-5231.html", "image_url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/getty/article/110/231/80608276_XS.jpg", "title": "Membership Drive Ideas for Organizations", "url": "bizfluent.com/membership-drive-ideas-organizations-5231.html" }, { "_id": "bizfluent.com/how-7516536-welcome-someone-newsletter.html", "external_url": "bizfluent.com/how-7516536-welcome-someone-newsletter.html", "image_url": "#", "title": "How to Welcome Someone in a Newsletter", "url": "bizfluent.com/how-7516536-welcome-someone-newsletter.html" }, { "_id": "bizfluent.com/rotary-club-membership-criteria-11799.html", "external_url": "bizfluent.com/rotary-club-membership-criteria-11799.html", "image_url": 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It is important that each prospective new member is excited about joining the organization and has a specific role to contribute to its functioning. Otherwise, it will be difficult to explain why a prospective member should join, and the weak message could turn a number of prospective members off from the organization. For example, a number of organizations nationwide sponsor an AIDS Walk for Life, in which people contribute funds to research ways to combat AIDS based on how many people choose to \"Walk for Life.\" The membership drive to join the walk is essentially infinite, with each person walking having the opportunity to contribute to the organization." }, { "content": "Choose a place to conduct your membership drive. The area should be highly concentrated with the type of person you hope to join your organization. An area is useless if it is packed with people, but not the kind of people you seek for your organization. For example, an AIDS Walk for Life membership drive is conducted most frequently at colleges or in parks--two locations where one can find people that have the free time to contribute to the organization or at least clearly enjoy walking in the outdoors. As another example, the military conducts membership drives at colleges or in high schools, two areas where most of the population has not yet made career-related decisions." }, { "content": "Make the membership process as simple as possible. This step is somewhat optional and dependent on what level of commitment and how much time a new member would be expected to commit to the organization. For example, fraternities and sororities at college frequently hold the equivalent of membership drives; however, the membership process itself is rather difficult, because the organizations are highly selective about who they want in. Alternatively, AARP runs membership drives through the mail and online almost exclusively, because their target members are too busy to attend membership drives in person or more easily reachable at home." }, { "content": "Educate your staff on everything related to the organization (such as the purpose and future of the organization and the actual practice of conducting the membership drive). Your goal here is to ensure that each of your staff members can answer a slew of organization-related questions and be confident in the process of recruiting new members. Type and print out a \"Frequently Asked Questions\" sheet for each of your staff members for reference; however, they should know the answers without the sheet." }, { "content": "Create a clear symbol that will help others identify your group. Organizationally, it will help the membership drive run smoothly if all staff members have a shirt or other clear symbol that clearly indicates they are part of the organization." } ], "title": "" } ], "studio_article_id": 1624138, "studio_id": "1b83bf18-a2c8-439b-b001-709296c1cefc", "summary": "Membership drives are useful for expanding an organization or simply increasing the name recognition of an organization. And they are used by all types of organizations. Here are some guidelines any group can follow.", "thumbnail": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a06/06/og/conduct-membership-drive-800x800.jpg", "title": "How to Conduct a Membership Drive", "title_id": 4529746, "type": "Article", "url": "/conduct-membership-drive-5789.html", "widget_stats": { "thumb": { "-1": 0, "1": 1 } }, "writer": "www.demandstudios.com/contributor/80f2c7b8-ab34-4594-bdc7-9f21e40640d2" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13298174/petty-cash-policies-procedures", "_id": "bizfluent.com/13298174/petty-cash-policies-procedures", "_last_updated": "2019-06-04T15:55:17.351000", "_type": "document", "_url": "http://bizfluent.com/13298174/petty-cash-policies-procedures", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13298174/petty-cash-policies-procedures", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Freestyle", "id": "bizfluent.com/13298174/petty-cash-policies-procedures", "image": {}, "keywords": [ "petty cash", "accounting functions", "business accounting policies" ], "last_updated": "2019-06-04T15:55:17.351000", "level": 2, "meta": { "embeds": 0, "images": 0, "sections": 5, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 479 }, "og_title": "Petty Cash Policies & Procedures", "original_published_date": "2010-07-09T00:00:00", "owning_domain": "bizfluent.com", "page_title": "Petty Cash Policies & Procedures", "parent_category": "bizfluent.com/accounting/", "pub_date": "2010-07-09T00:00:00", "readability": "12", "references": [ { "title": "\"Accounting\"; Charles T. Horngren, Walter T. Harrison, Jr.; 2007" } ], "related_content_rcp": [ { "_id": "bizfluent.com/how-6902426-design-accounting-information-system.html", "external_url": "bizfluent.com/how-6902426-design-accounting-information-system.html", "image_url": "#", "title": "How to Design an Accounting Information System", "url": "bizfluent.com/how-6902426-design-accounting-information-system.html" }, { "_id": "bizfluent.com/how-8377066-balance-petty-cash.html", "external_url": "bizfluent.com/how-8377066-balance-petty-cash.html", "image_url": "#", "title": "How to Balance Petty Cash", "url": "bizfluent.com/how-8377066-balance-petty-cash.html" }, { "_id": "bizfluent.com/list-6773437-problems-management-accounting.html", "external_url": "bizfluent.com/list-6773437-problems-management-accounting.html", "image_url": "http://photos.demandstudios.com/getty/article/81/10/86516239.jpg", "title": "Problems of Management Accounting", "url": "bizfluent.com/list-6773437-problems-management-accounting.html" }, { "_id": 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"bizfluent.com/facts-7176355-corporate-structure-hotel-chains.html" }, { "_id": "bizfluent.com/about-5130966-types-transaction-cycles-accounting.html", "external_url": "bizfluent.com/about-5130966-types-transaction-cycles-accounting.html", "image_url": "#", "title": "Types of Transaction Cycles in Accounting", "url": "bizfluent.com/about-5130966-types-transaction-cycles-accounting.html" }, { "_id": "bizfluent.com/list-6874340-characteristics-computerized-system-accounting-environment-.html", "external_url": "bizfluent.com/list-6874340-characteristics-computerized-system-accounting-environment-.html", "image_url": "http://photos.demandstudios.com/getty/article/34/15/86802151.jpg", "title": "What Are the Characteristics of a Computerized System Accounting Environment?", "url": "bizfluent.com/list-6874340-characteristics-computerized-system-accounting-environment-.html" } ], "sections": [ { "parts": [ { "content": "Small business management requires business owners to set various policies and procedures for their company’s operations. Accounting policies and procedures are an important part of small business management. Business owners create these policies and procedures to ensure all information is handled in a consistent manner. Small businesses with several employees often rely on policies and procedures to create an expected level of behavior in the company. Petty cash policies and procedures are an important part of small business management." } ] }, { "parts": [ { "content": "Petty cash is a small amount of money set aside for miscellaneous expenditures. Business owners recognize the need for petty cash because small financial expenditures often arise in business. Most small businesses maintain a small cash box for petty cash purposes. Business owners may designate an accounting employee to handle the petty cash. Accountants are usually responsible for reconciling the petty cash at the end of an accounting period. Accountants will also prepare journal entries for the company’s general ledger." } ], "rich_title": "Facts", "title": "Facts" }, { "parts": [ { "content": "Business owners usually attempt to create simple petty cash policies and procedures. This ensures the petty cash function does not become a bureaucratic mess in the business. Employees must usually fill out a simple receipt detailing the amount of money taken from petty cash and what it was spent on. Employees should return any change along with an official receipt to the petty cash box. This information helps accountants reconcile petty cash." } ], "rich_title": "Employee Policies And Procedures", "title": "Employee Policies And Procedures" }, { "parts": [ { "content": "Accountants usually review all information in the petty cash box at the end of an accounting period. Larger business organizations may require accountants to conduct this process more frequently if the petty cash is used for several different purchases. Accountants will review the ending petty cash balance and all receipts for money spent during the accounting period. The sum of this information should equal the opening balance of the petty cash. Differences may require a deeper reconciliation process." } ], "rich_title": "Accounting Policies And Procedures", "title": "Accounting Policies And Procedures" }, { "parts": [ { "content": "Petty cash policies and procedures help business owners limit the amount of time they spend on their accounts payable process. Accounts payable is responsible for writing checks and paying the company’s bills. Smaller or home-based businesses usually require the business owner to complete this function. Larger organizations often employ accounting clerks to work in accounts payable. Cutting checks for minor purchases can quickly become a waste of time. Setting up a petty cash box helps eliminate additional accounts payable work." } ], "rich_title": "Features", "title": "Features" }, { "parts": [ { "content": "Business owners may consider using a petty cash box for each department or division in larger business organizations. Dollar amounts can be specific to each department or division based on the number of employees or need for petty cash. Business owners can delegate an operational manager to be responsible for the petty cash box in their department. Accountants can then check up on these managers to ensure all petty cash procedures are being followed by employees." } ], "rich_title": "Considerations", "title": "Considerations" } ], "studio_article_id": "2398352", "studio_id": "5b73eb1f-be03-4286-a799-f4d8df78e604", "summary": "Small business management requires business owners to set various policies and procedures for their company’s operations. Accounting policies and procedures are an important part of small business management. Business owners create these policies and procedures to ensure all information is handled in a consistent manner. Small businesses with several employees often rely on policies and procedures to create an expected level of behavior in the company. Petty cash policies and procedures are an important part of small business management.", "tags": [], "title": "Petty Cash Policies & Procedures", "title_id": 13298174, "type": "Article", "url": "/13298174/petty-cash-policies-procedures", "writer": "www.demandstudios.com/contributor/1dd69910-4899-4669-be35-7696b7a58818" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13298984/accounting-entries-for-selling-an-asset", "_id": "bizfluent.com/13298984/accounting-entries-for-selling-an-asset", "_last_updated": "2019-06-04T15:55:18.261000", "_type": "document", "_url": "http://bizfluent.com/13298984/accounting-entries-for-selling-an-asset", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13298984/accounting-entries-for-selling-an-asset", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": 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"http://photos.demandstudios.com/0/159/fotolia_3189913_thumb.jpg", "thumbwidth": "110", "url": "http://photos.demandstudios.com/60/72/fotolia_3189913_XS.jpg", "width": 400, "x": "1" }, "keywords": [ "disposal", "journal entry", "fixed asset" ], "last_updated": "2019-06-04T15:55:18.261000", "level": 2, "meta": { "embeds": 0, "images": 1, "sections": 5, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 525 }, "og_title": "Accounting Entries for Selling an Asset", "original_published_date": "2010-07-22T00:00:00", "owning_domain": "bizfluent.com", "page_title": "Accounting Entries for Selling an Asset", "parent_category": "bizfluent.com/accounting/", "pub_date": "2010-07-22T00:00:00", "readability": "13", "references": [ { "_id": "http://www.schneiderdowns.com/Fixed_Asset_Impairment_Consideration", "external_url": "http://www.schneiderdowns.com/Fixed_Asset_Impairment_Consideration", "title": "Schneider Downs: Fixed Asset Impairment 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"bizfluent.com/about-7264908-accounting-capital-expenditure.html", "image_url": "http://photos.demandstudios.com/getty/article/139/60/468017699.jpg", "title": "Accounting for Capital Expenditure", "url": "bizfluent.com/about-7264908-accounting-capital-expenditure.html" } ], "sections": [ { "parts": [ { "image": { "alttext": "...", "aspectratio": 1.3333333333333333, "attributionhtml": "tractor image by Alison Bowden from Fotolia.com", "caption": "Ajdusting entries are made to reflect the sales of equipment, such as tractors and earth loaders.", "credit": "tractor image by Alison Bowden from Fotolia.com", "guid": "f66bbf15-2b71-f69d-0254-73d5817e4a49", "height": 300, "photoid": "Imported/1495645952.11/8649b9cf-52fe-463c-ad29-d5ddd0f16040", "thumbheight": "83", "thumburl": "http://photos.demandstudios.com/0/159/fotolia_3189913_thumb.jpg", "thumbwidth": "110", "url": "http://photos.demandstudios.com/60/72/fotolia_3189913_XS.jpg", "width": 400, "x": "1" } }, { "content": "Assets aid in producing income and adding wealth to an organization\u2019s books. Generally, assets are held for investment and have significant monetary value. For this reason, assets are often sold during economic downturns in the economy to produce cash or to dispose of obsolete materials that have a negative effect on the organization\u2019s ability to produce income. Regardless of the reason, when selling an asset, adjusting entries are made to accurately report the value of a company\u2019s holdings." } ] }, { "parts": [ { "content": "Commonly sold assets are investments, such as securities and bonds, and fixed assets, such as land, buildings and equipment. Investments are typically maintained by a broker, with their value reported on monthly or quarterly statements. Fixed asset schedules are maintained by the company and require management to update the schedule on a regular basis. Fixed asset schedules are a list of a company's assets that include the cost of the asset, the method of depreciation, and prior and current period depreciation expenses. To record entries needed for the disposal of a fixed asset, management must be familiar with these terms and understand debits and credits." } ], "rich_title": "Facts", "title": "Facts" }, { "parts": [ { "content": "Adjusting entries, or journal entries, are needed to accurately record the value of a company\u2019s assets on financial statements. Financial statements are presented to bankers to obtain loans and to potential business partners to enter into joint venture agreements. Bankers often calculate financial ratios based on the information presented on financial statements. Potential business partners use statements to evaluate the strength of the company. Failure to correctly record journal entries may result in unfavorable consequences if a business partner were to lose money based on incorrect financial statements." } ], "rich_title": "Significance", "title": "Significance" }, { "parts": [ { "content": "Journal entries are posted to a company\u2019s general ledger system when disposing of assets due to sales, obsolescence or natural disasters. Management uses investment statements to adjust the value of securities and bonds on the balance sheet. Management uses the depreciation schedule and agreed-upon sale prices to adjust the value of fixed assets. When posting a journal entry, computerized accounting systems automatically reduce the asset, increase cash, and record revenues or losses from the sale." } ], "rich_title": "Function", "title": "Function" }, { "parts": [ { "content": "When selling a piece of machinery, management reduces fixed assets by crediting the account by its current value. Management then increases cash by the amount received and records the difference as a gain or loss. For instance, an earth loader with an original purchase price of $20,000 and a current value of $10,000 is sold to a local contractor for $12,000. Management increases the cash account $12,000 with a debit and decreases fixed assets $10,000 with a credit. To balance the journal entry, the difference of $2,000 is credited as a gain and is recorded as revenue." } ], "rich_title": "Example", "title": "Example" }, { "parts": [ { "content": "Disposals of assets are sometimes complicated and may require the assistance of a professional accountant. Due to natural disasters or market downturns, the values of assets are sometimes impaired. According to Schneider Downs Accountants, impairments occur when there are permanent decreases in the value of an asset. For instance, the value of a security that has permanently changed due to market conditions requires journal entries to reduce the value of the security before the asset is sold." } ], "rich_title": "Considerations", "title": "Considerations" } ], "studio_article_id": "2468692", "studio_id": "f5342e97-7b38-44b5-bcbb-b7f0ad52f6fd", "summary": "Assets aid in producing income and adding wealth to an organization’s books. Generally, assets are held for investment and have significant monetary value. For this reason, assets are often sold during economic downturns in the economy to produce cash or to dispose of obsolete materials that have a negative effect on the organization’s ability to produce income. Regardless of the reason, when selling an asset, adjusting entries are made to accurately report the value of a company’s holdings.", "tags": [], "thumbnail": "http://photos.demandstudios.com/60/72/fotolia_3189913_XS.jpg", "title": "Accounting Entries for Selling an Asset", "title_id": 13298984, "type": "Article", "url": "/13298984/accounting-entries-for-selling-an-asset", "writer": "www.demandstudios.com/contributor/587bd4fb-1681-4f4c-a7a7-672877f2fbe8" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/make-company-budget-plan-4465103.html", "_id": "bizfluent.com/make-company-budget-plan-4465103.html", "_last_updated": "2017-10-23T14:03:42.882000", "_type": "document", "_url": "http://bizfluent.com/make-company-budget-plan-4465103.html", "ad_category": [ "business_finance", "business", "business_operations" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "How to Make a Company Budget Plan. Creating a set budget for a company should not be intimidating. It should, however, be planned in depth to achieve the maximum financial outcome. Whether you are starting a company budget or planning an existing company budget, the same rule applies--develop a strategic plan for a set budget as well as forecasting. To make a company budget plan, consider the operational and financial aspects of the business.", "external_url": "bizfluent.com/make-company-budget-plan-4465103.html", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Topic View", "id": "bizfluent.com/make-company-budget-plan-4465103.html", "image": { "_id": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a04/88/ef/make-company-budget-plan-800x800.jpg", "caption": "Setting a budget is good business", "credit": "cutting the it budget 3 image by Andrew Brown from Fotolia.com", "external_url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a04/88/ef/make-company-budget-plan-800x800.jpg", "height": 283, "thumbnail_url": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/i.ehow.com/images/a04/88/ef/make-company-budget-plan-180x180.jpg", "url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a04/88/ef/make-company-budget-plan-800x800.jpg", "validated_image": true, "width": 424 }, "last_updated": "2017-10-23T14:03:42.882000", "level": 4, "old_fixed_category": [ { "_id": "/management/", "external_url": "/management/", "title": "Management", "url": "/management/" } ], "original_published_date": "2010-07-28T15:21:47", "owning_domain": "bizfluent.com", "parent_category": "bizfluent.com/accounting/", "pub_date": "2010-07-28T15:21:47", "publisher_id": 4465103, "readability": "11", "related_content_rcp": [ { "_id": "bizfluent.com/info-7749442-expenditure-budget.html", "external_url": "bizfluent.com/info-7749442-expenditure-budget.html", "image_url": "http://photos.demandstudios.com/getty/article/149/124/186000145.jpg", "title": "What Is an Expenditure Budget?", "url": "bizfluent.com/info-7749442-expenditure-budget.html" }, { "_id": "bizfluent.com/how-6503554-write-capital-expenditure-policy.html", "external_url": "bizfluent.com/how-6503554-write-capital-expenditure-policy.html", "image_url": "http://photos.demandstudios.com/49/220/fotolia_6332197_XS.jpg", "title": "How to Write a Capital Expenditure Policy", "url": "bizfluent.com/how-6503554-write-capital-expenditure-policy.html" }, { "_id": "bizfluent.com/list-7694437-uses-sales-budget.html", "external_url": "bizfluent.com/list-7694437-uses-sales-budget.html", "image_url": "#", "title": "The Uses of a Sales Budget", "url": "bizfluent.com/list-7694437-uses-sales-budget.html" }, { "_id": "bizfluent.com/list-6727118-key-activities-management-accounting.html", "external_url": "bizfluent.com/list-6727118-key-activities-management-accounting.html", "image_url": "#", "title": "The Key Activities of Management Accounting", "url": "bizfluent.com/list-6727118-key-activities-management-accounting.html" }, { "_id": "bizfluent.com/facts-6750338-importance-budgetary-control-management-accounting.html", "external_url": "bizfluent.com/facts-6750338-importance-budgetary-control-management-accounting.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/7279747e6e644337822522fcd665315f", "title": "The Importance of Budgetary Control in Management Accounting", "url": "bizfluent.com/facts-6750338-importance-budgetary-control-management-accounting.html" }, { "_id": "bizfluent.com/info-8776893-purpose-audit-evaluation-budget.html", "external_url": "bizfluent.com/info-8776893-purpose-audit-evaluation-budget.html", "image_url": "#", "title": "What Is the Purpose of an Audit & Evaluation for a Budget?", "url": "bizfluent.com/info-8776893-purpose-audit-evaluation-budget.html" }, { "_id": "bizfluent.com/how-8308053-calculate-required-inventory-level.html", "external_url": "bizfluent.com/how-8308053-calculate-required-inventory-level.html", "image_url": "#", "title": "How to 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"_id": "bizfluent.com/info-8612395-budget-reserves-vs-management-reserves.html", "external_url": "bizfluent.com/info-8612395-budget-reserves-vs-management-reserves.html", "image_url": "#", "title": "Budget Reserves Vs. 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It is essential that the management overseeing the budget not only create an effective budget plan, but also that management use proper observation, analytical and reporting techniques." }, { "content": "Look to the future and make assumptions regarding variables or situations that may affect the company's budget plan. This allows a proactive approach to be established if the economy sours or in case unforeseen events occur." }, { "content": "Set goals. The annual plan's foundation is established based on the goals set forth in the company's budget plan. Company budget goals may include rate of return on investments, market share, establishing quality leadership and survival. Make predictions about the future outcome of the business. This is called forecasting." }, { "content": "Include a performance objective. This is yet another goal that requires action. A performance objective is a set goal to attain a certain performance level. For example, a performance objective could be to earn a $200,000 in a year or even a quarter." }, { "content": "Integrate expenditures, asset requirements and estimated finances needed." }, { "content": "Coordinate by creating a detailed, organized budget plan structured and organized in a flow chart. This should organize the company's budget objectives." }, { "content": "Format the budget plan to show a budgeted balance sheet, including assets, liabilities and other financial information." }, { "content": "Document the progress of the budget, including all account payables, accrued expenses and other debts. A financial document should list account receivables as well." }, { "content": "Take control of the company budget plan. Because the budget is subject to change based on economic and unexpected circumstances, implement new strategies if necessary and monitor the financial performance of the budget by creating daily reports that show how well you are doing against the goals." } ], "title": "" } ], "studio_article_id": 50658, "studio_id": "dbf5d23c-aff2-42ed-ad2a-dc027dec20df", "summary": "Creating a set budget for a company should not be intimidating. It should, however, be planned in depth to achieve the maximum financial outcome. Whether you are starting a company budget or planning an existing company budget, the same rule applies--develop a strategic plan for a set budget as well as forecasting. To make a company budget plan, consider the operational and financial aspects of the business.", "thumbnail": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a04/88/ef/make-company-budget-plan-800x800.jpg", "tips": [ "Purchase applicable software for tracking budgets.", "Seek professional financial guidance for business owners.", "Attend business financial seminars to learn more tips and techniques for running a business." ], "title": "How to Make a Company Budget Plan", "title_id": 2431466, "type": "Article", "url": "/make-company-budget-plan-4465103.html", "warnings": [ "Never make budget plans without extensive knowledge of the company." ], "writer": "www.demandstudios.com/contributor/42bfbf81-c6b9-4fc3-a96c-2267c772d795" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/check-nonprofit-status-5710.html", "_id": "bizfluent.com/check-nonprofit-status-5710.html", "_last_studio_import": "2014-08-29T14:40:24.576000", "_last_updated": "2017-11-21T21:09:30.318000", "_type": "document", "_url": "http://bizfluent.com/check-nonprofit-status-5710.html", "ad_category": [ "technology_computing", "internet_technology", "web_search" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "There are many types of non-profit organizations working towards various educational, religious, scientific and charitable goals. Some of these organizations are more well-known than others. If you're interested in working with an organization by donating goods or your services you can check the non-profit status of the organization to be sure it is a real charitable organization. The Internal Revenue Service (IRS) provides a non-profit status search tool.", "editor": "www.demandstudios.com/contributor/938ed819-ac30-4b17-92d3-76696c3bc37b", "external_url": "bizfluent.com/check-nonprofit-status-5710.html", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Topic View", "id": "bizfluent.com/check-nonprofit-status-5710.html", "image": { "_id": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "attributionhtml": "Donations image by Rebs O from Fotolia.com", "caption": "Check the status of non-profit organizations before you make donations.", "credit": "Donations image by Rebs O from Fotolia.com", "external_url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "guid": "bbf6dfaa-e49c-663c-42d3-83f036bc3aef", "height": 282, "thumbheight": "83", "thumbnail_url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "thumburl": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/photos.demandstudios.com/124/182/fotolia_7471964_thumb.jpg", "thumbwidth": "110", "url": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "validated_image": true, "width": 426 }, "keywords": [ "check non profits", "charitable organizations", "research charities" ], "last_studio_import": "2014-08-29T14:40:24.576000", "last_updated": "2017-11-21T21:09:30.318000", "level": 2, "old_fixed_category": [ { "_id": "/nonprofit/", "external_url": "/nonprofit/", "title": "Nonprofit", "url": "/nonprofit/" } ], "original_published_date": "2010-11-14T14:36:43", "owning_domain": "bizfluent.com", 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"bizfluent.com/how-7370436-apply-tax-exempt-number-tennessee.html", "image_url": "#", "title": "How to Apply for a Tax Exempt Number in Tennessee", "url": "bizfluent.com/how-7370436-apply-tax-exempt-number-tennessee.html" }, { "_id": "bizfluent.com/facts-7916928-barcode-interpretation.html", "external_url": "bizfluent.com/facts-7916928-barcode-interpretation.html", "image_url": "http://photos.demandstudios.com/44/117/fotolia_2400563_XS.jpg", "title": "Barcode Interpretation", "url": "bizfluent.com/facts-7916928-barcode-interpretation.html" }, { "_id": "bizfluent.com/how-5846173-check-tax-exempt-number.html", "external_url": "bizfluent.com/how-5846173-check-tax-exempt-number.html", "image_url": "http://photos.demandstudios.com/getty/article/83/45/76801607.jpg", "title": "How to Check a Tax Exempt Number", "url": "bizfluent.com/how-5846173-check-tax-exempt-number.html" }, { "_id": "bizfluent.com/how-10063160-log-teletech-oracle.html", "external_url": 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"bizfluent.com/how-6813341-create-barcode.html", "external_url": "bizfluent.com/how-6813341-create-barcode.html", "image_url": "http://photos.demandstudios.com/14/60/fotolia_4000899_XS.jpg", "title": "How to Create a Barcode", "url": "bizfluent.com/how-6813341-create-barcode.html" }, { "_id": "bizfluent.com/facts-5923304-difference-board-directors-slate-officers-.html", "external_url": "bizfluent.com/facts-5923304-difference-board-directors-slate-officers-.html", "image_url": "http://farm4.static.flickr.com/3019/2631534424_6c8ecd0c66.jpg", "title": "What Is the Difference Between a Board of Directors and a Slate of Officers?", "url": "bizfluent.com/facts-5923304-difference-board-directors-slate-officers-.html" }, { "_id": "bizfluent.com/how-5728415-fill-sales-tax-form-state.html", "external_url": "bizfluent.com/how-5728415-fill-sales-tax-form-state.html", "image_url": "#", "title": "How to Fill Out a Sales Tax Form for the State", "url": 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"https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/cache.gettyimages.com/7f2bcf91ff5541ad85ef1f752efcbb27.jpg", "title": "How to Find Employer's Employer Identification Number", "url": "bizfluent.com/how-5001931-employers-identification-number.html" }, { "_id": "bizfluent.com/12812044/how-to-calculate-employer-payroll-unemployment-taxes-in-washington", "external_url": "bizfluent.com/12812044/how-to-calculate-employer-payroll-unemployment-taxes-in-washington", "image_url": "http://photos.demandstudios.com/getty/article/117/33/76755236.jpg", "title": "How to Calculate Employer Payroll Unemployment Taxes in Washington", "url": "bizfluent.com/12812044/how-to-calculate-employer-payroll-unemployment-taxes-in-washington" }, { "_id": "bizfluent.com/how-7801331-wisconsin-business-tax-identification-number.html", "external_url": "bizfluent.com/how-7801331-wisconsin-business-tax-identification-number.html", "image_url": "http://photos.demandstudios.com/getty/article/240/130/465087564.jpg", "title": "How to Find a Wisconsin Business Tax Identification Number", "url": "bizfluent.com/how-7801331-wisconsin-business-tax-identification-number.html" }, { "_id": "bizfluent.com/how-7979374-calculate-apportionment.html", "external_url": "bizfluent.com/how-7979374-calculate-apportionment.html", "image_url": "#", "title": "How to Calculate Apportionment", "url": "bizfluent.com/how-7979374-calculate-apportionment.html" } ], "repurposed_from": [ "www.ehow.com" ], "sections": [ { "steps": [ { "content": "Log onto the Internal Revenue Service website. Select the \"Charities and Non-Profits\" tab located at the top of the web page. This will take you to the webpage that contains tax information and for charities and other non-profit organizations.", "title": "Step 1" }, { "content": "Select the \"Search for Charities\" link located on the left side of the webpage. Click the \"Search Now\" button. Enter your search terms into the appropriate field. You can search for the organization by entering its name into the appropriate field and you can search by city and state. Click the \"Search\" button to retrieve your search results.", "title": "Step 2" }, { "content": "Read your search results. Your search results should contain the organization's name, its location and its deductibility code, which ranges from one to six. The deductibility code is a coding system used by the IRS to identify each organization listed by type and limitation on the deductibility of charitable contributions to the organization. For example, if a charity has a number four deductibility code then it is a private foundation, generally with a 30 percent deductibility limitation. If the organization does not have a deduction code by its name then it is a public charity with a 50 percent deductibility limitation. The deductibility limitation represents the most you can deduct from your gross income for charitable contributions for that year.", "title": "Step 3" } ] } ], "studio_article_id": 3382934, "studio_id": "9eb3d0af-a912-4d2c-a372-016bebe2a8a0", "summary": "There are many types of non-profit organizations working towards various educational, religious, scientific and charitable goals. Some of these organizations are more well-known than others. If you're interested in working with an organization by donating goods or your services you can check the non-profit status of the organization to be sure it is a real charitable organization. The Internal Revenue Service (IRS) provides a non-profit status search tool.", "summary_is_first_section": true, "thumbnail": "http://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/55/95/fotolia_7471964_XS.jpg", "title": "How to Check a Non-Profit Status", "title_id": 6297414, "type": "Article", "url": "/check-nonprofit-status-5710.html", "writer": "www.demandstudios.com/contributor/33a525e2-3236-4cf3-ba17-4b48d0acb3f2" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/foundations-give-nonprofit-organizations-5430.html", "_id": "bizfluent.com/foundations-give-nonprofit-organizations-5430.html", "_last_updated": "2017-10-03T22:10:13.717000", "_type": "document", "_url": "http://bizfluent.com/foundations-give-nonprofit-organizations-5430.html", "ad_category": [ "news_politics", "politics", "political_issues" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "Henry David Thoreau once said, \"Philanthropy is almost the only virtue which is sufficiently appreciated by mankind.\" Thoreau would be pleased to know that philanthropy is still alive and well 150 years after his death. In the United States, literally hundreds of foundations offer grants to nonprofit organizations. Nonprofits must conduct business for the benefit of the public without shareholders or a profit motive.They include groups such as churches, charities and political associations.", "external_url": "bizfluent.com/foundations-give-nonprofit-organizations-5430.html", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Topic View", "id": "bizfluent.com/foundations-give-nonprofit-organizations-5430.html", "image": { "_id": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ij/64/foundations-give-nonprofit-organizations-800x800.jpg", "caption": "Philanthropy is alive and well in the United States.", "credit": "Give image by patell from Fotolia.com", "external_url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ij/64/foundations-give-nonprofit-organizations-800x800.jpg", "height": 246, "thumbnail_url": "http://s3.amazonaws.com/cme_public_images/www_ehow_com/i.ehow.com/images/a07/ij/64/foundations-give-nonprofit-organizations-180x180.jpg", "url": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ij/64/foundations-give-nonprofit-organizations-800x800.jpg", "validated_image": true, "width": 400 }, "last_updated": "2017-10-03T22:10:13.717000", "level": 2, "old_fixed_category": [ { "_id": "/nonprofit/", "external_url": "/nonprofit/", "title": "Nonprofit", "url": "/nonprofit/" } ], "original_published_date": "2011-02-17T07:10:19", "owning_domain": "bizfluent.com", "parent_category": "bizfluent.com/accounting/", "pub_date": "2011-02-17T07:10:19", "publisher_id": 7949508, "readability": "12", "references": [ { "_id": "https://www.heinz.com/sustainability.aspx/social/heinz-foundation.aspx", "external_url": "https://www.heinz.com/sustainability.aspx/social/heinz-foundation.aspx", "title": "H.J. Heinz Company Foundation: Home", "type": "Unknown", "url": "https://www.heinz.com/sustainability.aspx/social/heinz-foundation.aspx" }, { "_id": "https://www.gatesfoundation.org/about/Pages/foundation-fact-sheet.aspx", "external_url": "https://www.gatesfoundation.org/about/Pages/foundation-fact-sheet.aspx", "title": "Bill and Melinda Gates Foundation: Fact Sheet", "type": "Unknown", "url": "https://www.gatesfoundation.org/about/Pages/foundation-fact-sheet.aspx" }, { "_id": "https://mellon.org/", "external_url": "https://mellon.org/", "title": "Andrew W. Mellon Foundation: Home", "type": "Unknown", "url": "https://mellon.org/" } ], "related_content_rcp": [ { "_id": "bizfluent.com/proctor-gamble-grants-5969.html", "external_url": "bizfluent.com/proctor-gamble-grants-5969.html", "image_url": "http://photos.demandstudios.com/getty/article/235/114/177708319.jpg", "title": "Proctor & Gamble Grants", "url": "bizfluent.com/proctor-gamble-grants-5969.html" }, { "_id": "bizfluent.com/info-7735757-bill-gates-scholarships-grants.html", "external_url": "bizfluent.com/info-7735757-bill-gates-scholarships-grants.html", "image_url": "#", "title": "Bill Gates Scholarships & Grants", "url": "bizfluent.com/info-7735757-bill-gates-scholarships-grants.html" }, { "_id": "bizfluent.com/list-6949575-grants-sears.html", "external_url": "bizfluent.com/list-6949575-grants-sears.html", "image_url": "http://photos.demandstudios.com/getty/article/241/58/453579685.jpg", "title": "Grants From Sears", "url": "bizfluent.com/list-6949575-grants-sears.html" }, { "_id": 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"title": "Grants for Christian Elementary Schools", "url": "bizfluent.com/info-8764739-grants-christian-elementary-schools.html" }, { "_id": "bizfluent.com/list-6696179-apartment-building-grants.html", "external_url": "bizfluent.com/list-6696179-apartment-building-grants.html", "image_url": "http://photos.demandstudios.com/162/36/fotolia_3035663_XS.jpg", "title": "Apartment Building Grants", "url": "bizfluent.com/list-6696179-apartment-building-grants.html" } ], "repurposed_from": [ "www.ehow.com" ], "sections": [ { "steps": [ { "content": "The H.J. Heinz Company Foundation was established in 1951 with the goal to promote health and nutrition around the world. However, its Close to Home program works as a benefactor in the communities in which it operates and has made contributions to the Greater Pittsburgh Community Food Bank, the Pittsburgh Public Theater and Operation Warm. It offers grants to organizations that are considered exempt under section 501(c)3 of the IRS Tax Code. The foundation does not provide grants to individuals or make multi-year pledges except for major capital or grant campaigns. Its core program areas include promoting better understanding of good nutrition, diversity through the advancement of minorities via education and community opportunities, and supporting programs with an emphasis on children and youth. Grant application guidelines are available on the foundation's website." } ], "title": "H.J. Heinz Company Foundation" }, { "steps": [ { "content": "Based in Seattle, Washington, the Bill & Melinda Gates Foundation was created to help people lead healthy, productive lives. It is active in developing countries, where it focuses on improving health and helping people lift themselves out of hunger and poverty. In the United States, it works to ensure that all people have opportunities needed to succeed in school and life. The foundation has given literally billions of dollars in grants to an array of organizations such as the GAVI Alliance (which promotes childhood immunization), Save the Children, the United Negro College Fund and Gateway to College." } ], "title": "Bill and Melinda Gates Foundation" }, { "steps": [ { "content": "Established in 1969, the Andrew W. Mellon Foundation is a not-for-profit corporation under the laws of the state of New York. It was created through the consolidation the Avalon Foundation and Old Dominion Foundation. By the end of 2009, it boasted annual grant-making appropriations of approximately $199.5 million. The foundation offers grants in five core areas: higher education and scholarship, scholarly communications and information technology, museums and art conservation, the performing arts, and conservation and the environment. Grant inquiries should be made in writing or via email. The foundation does not provide grants to individuals and unsolicited proposals are seldom funded." } ], "title": "Andrew W. Mellon Foundation" }, { "steps": [ { "content": "Animal Welfare Trust offers grant programs that focus on grassroots efforts that contribute to animal welfare. It is a 501(C)(3) private operating foundation established in 2001. AWT also strives to create its own projects, often in partnership with other organizations dedicated to the cause of animal welfare. AWT also lobbies for legislative reform in support of its cause. The trust looks for organizations with clearly defined goals and does not consider capital projects. As of February 2011, it offers about 10 to 15 grants annually that range from $2,500 to $20,000. Applicants can apply via email inquires to determine if the request falls within the scope of the funding program. The programs tend to focus on farm animal welfare, vegetarianism and humane education." } ], "title": "Animal Welfare Trust" } ], "studio_article_id": 4010682, "studio_id": "8d5fee91-d7f2-470a-86d9-838ea30e8dbb", "summary": "Henry David Thoreau once said, \"Philanthropy is almost the only virtue which is sufficiently appreciated by mankind.\" Thoreau would be pleased to know that philanthropy is still alive and well 150 years after his death. In the United States, literally hundreds of foundations offer grants to nonprofit organizations. Nonprofits must conduct business for the benefit of the public without shareholders or a profit motive.They include groups such as churches, charities and political associations.", "thumbnail": "http://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a07/ij/64/foundations-give-nonprofit-organizations-800x800.jpg", "title": "Foundations That Give to Nonprofit Organizations", "title_id": 6863500, "type": "Article", "url": "/foundations-give-nonprofit-organizations-5430.html", "widget_stats": { "thumb": { "-1": 0, "1": 1 } }, "writer": "www.demandstudios.com/contributor/fd6081b4-e6d1-4a62-b403-811c8d9a3a5f" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/list-international-non-profit-organizations-10665.html", "_id": "bizfluent.com/list-international-non-profit-organizations-10665.html", "_last_updated": "2017-10-03T22:10:16.263000", "_type": "document", "_url": "http://bizfluent.com/list-international-non-profit-organizations-10665.html", "ad_category": [ "news_politics", "politics", "political_issues" ], "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "byline": "Contributor", "content_type": "TopicView", "culture": "en-US", "description": "Whether you are looking to make a charitable donation, volunteer or are just gathering information for a research paper, it is helpful to know what types of international nonprofit organizations are out there. 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"url": "bizfluent.com/info-8596380-advantages-disadvantages-oecs.html" } ], "repurposed_from": [ "www.ehow.com" ], "sections": [ { "steps": [ { "content": "Health Development International is a nonprofit organization committed to improving health care conditions in impoverished areas around the world through education and mentoring. HDI has programs in Brazil, Romania, India and China. HDI's mission is to make medical services available to all people. The International Hospital Federation is a nonprofit health care organization with multiple locations around the world, such as Africa, South America, Europe and Asia. IHF works in communities to establish teams that will help develop and operate hospitals." } ], "title": "Health Care Organizations" }, { "steps": [ { "content": "The World Wildlife Fund is an organization that is in the business of protecting animals and endangered species. The WWF works in 100 countries around the world and has millions of supporters. WWF's goal is to restore nature and preserve animal and plant species in their natural habitat. The International Fund for Animals Welfare rescues animals that are in crisis around the world. Members of the organization respond to urgent animal needs so that they may save animals' lives. The organization handles incidents of neglect, abuse and other emergency situations. IFAW has locations in North America, Europe and Africa." } ], "title": "Animal Organizations" }, { "steps": [ { "content": "International nonprofit adoption organizations aim to find homes for orphaned children around the world. La Vida International is one such organization that works in China, Columbia and Nepal, and helps locate families in the United States who wish to adopt children from those regions. Christian World Adoption is a faith-based adoption organization that offers programs in Bulgaria, China, Ethiopia, Russia and the Ukraine. Staff at CWA work with families to help them get ready for adoption, including assisting with paperwork and document translation services." } ], "title": "Adoption Organizations" }, { "steps": [ { "content": "Many nonprofit organizations strive to end poverty and hunger through worldwide calls to action. One such organization is The Hunger Project, which is a global nonprofit agency with a mission to teach individuals how to be self-reliant so that they may meet their own basic needs. CARE is a nonprofit organization whose mission is to fight global poverty and hunger. Its helps poverty-stricken countries by educating the community, expanding economic opportunities and relieving communities of crises." } ], "title": "Poverty and Hunger Organizations" } ], "studio_article_id": 4107008, "studio_id": "e38c517c-34b6-4b9d-aa72-38aa0f05e6f9", "summary": "Whether you are looking to make a charitable donation, volunteer or are just gathering information for a research paper, it is helpful to know what types of international nonprofit organizations are out there. 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"bizfluent.com/how-8255098-campaign-sponsor.html" } ], "sections": [ { "parts": [ { "image": { "alttext": "...", "aspectratio": 1.4981273408239701, "attributionhtml": "office work image by TEMISTOCLE LUCARELLI from Fotolia.com", "caption": "A fiscal sponsorhip requires two parties with aligned missions.", "credit": "office work image by TEMISTOCLE LUCARELLI from Fotolia.com", "guid": "260b3e8a-728d-bd2c-0a2a-30a84383db55", "height": 267, "photoid": "fotolia/6146170", "thumbheight": "73", "thumburl": "http://photos.demandstudios.com/98/168/fotolia_6146170_thumb.jpg", "thumbwidth": "110", "url": "http://photos.demandstudios.com/98/168/fotolia_6146170_XS.jpg", "width": 400, "x": "1" } }, { "content": "Fiscal sponsorships help fledgling nonprofits get off to a fast start. In a fiscal sponsorship, a group without IRS 501(c)(3) tax-exempt status raises funds through a nonprofit with 501(c)(3) tax-exempt status. The tax-exempt group ensures that the sponsored group uses its funding for stated tax-exempt, charitable purposes. This relationship typically comes about when a group seeks funds from grant makers that give funding only to 501(c)(3) nonprofits. Sponsors must diligently follow sponsorship rules." } ] }, { "parts": [ { "content": "Joshua Sattely in his white paper, \"On Comprehensive Fiscal Sponsorship,\" warns that a fiscal sponsor must only offer a sponsorship to a group or project whose purpose and mission align with its own. When a 501(c)(3) nonprofit assumes sponsorship, the IRS considers it and the sponsored organization to be one and the same. All of the IRS 501(c)(3) nonprofit's activities must align with its stated mission in order for it to retain its tax-exempt status." } ], "rich_title": "Aligned Missions", "title": "Aligned Missions" }, { "parts": [ { "content": "According to IRS rules, fiscal sponsors retain control over how funds will be used and must keep records that demonstrate the funds were used for charitable 501(c)(3) tax-exempt purposes. Besides ensuring that a grant's financial, programmatic and administrative requirements are met, the sponsoring nonprofit can also provide other services to sponsored groups. In comprehensive fiscal sponsorships, sponsoring organizations typically supply office space and accounting, human resources and other back-office activities, and the sponsored group becomes its program, governed by the sponsor's own board of directors." } ], "rich_title": "Comprehensive Fiscal Sponsorships", "title": "Comprehensive Fiscal Sponsorships" }, { "parts": [ { "content": "A fiscal sponsorship is created and defined by a letter of agreement, or contract, ideally drafted by a lawyer. Fiscal sponsorships differ according to the needs and requirements of the fiscal sponsor and sponsored project, Grant Space notes, so there is no one legal contract covering all fiscal sponsorships. An agreement provides details regarding what each party expects from the other, what back-office services the sponsoring organization will provide, if any; how IRS reporting requirements will be handled and what fee the sponsor will charge for its services. It is also important for the agreement to provide information on the relationship's conclusion, such as when that will likely occur and how the sponsored organization's assets will be distributed. The National Network of Fiscal Sponsors recommends the sponsor's senior staff and the project's leaders meet regularly to evaluate the relationship. As circumstances develop over time, the sponsorship may no longer be in the best interests of either party." } ], "rich_title": "Legal Agreement", "title": "Legal Agreement" }, { "parts": [ { "content": "According to the Foundation Center, sometimes a 501(c)(3) nonprofit may act in a very limited way to pass funding to non-501(c)(3) group. But if the 501(c)(3) nonprofit does not provide sufficient oversight over the project, the IRS might conclude that the foundation or other grant-making entity has provided funds directly to a group without 501(c)(3) tax-exempt status. This prevents the grant maker from taking a charitable deduction and the non-501(c)(3) group will lose its funding. The 501(c)(3) nonprofit can also lose its tax-exempt status for allowing funds to be used in a non-charitable manner." } ], "rich_title": "Warning", "title": "Warning" } ], "studio_article_id": "5139572", "studio_id": "bdc527d8-3e0e-467d-91cd-878bdb76f132", "summary": "Fiscal sponsorships help fledgling nonprofits get off to a fast start. In a fiscal sponsorship, a group without IRS 501(c)(3) tax-exempt status raises funds through a nonprofit with 501(c)(3) tax-exempt status. The tax-exempt group ensures that the sponsored group uses its funding for stated tax-exempt, charitable purposes. This relationship typically comes about when a group seeks funds from grant makers that give funding only to 501(c)(3) nonprofits. 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Shat from Fotolia.com", "caption": "Selling in volume can be challenging.", "credit": "sale 70% off sign. all sale sign. free.cheap price image by L. Shat from Fotolia.com", "guid": "128c3040-27d6-42ee-2db2-21f7fa9223da", "height": 400, "photoid": "fotolia/1532317", "thumbheight": "110", "thumburl": "http://photos.demandstudios.com/242/77/fotolia_1532317_thumb.jpg", "thumbwidth": "83", "url": "http://photos.demandstudios.com/236/245/fotolia_1532317_XS.jpg", "width": 300, "x": "1" } }, { "content": "Volume discount pricing theory states that a firm can generate more net income by selling more items at a lower price than it can selling less items at a higher price. With the exponential boom of Wal-Mart, dollar concept stores and other discount stores in the 1970s and 1980s, small businesses are facing increased pressure from those who put this theory into practice. To adequately compete with these giants as a small business owner, it may be helpful to understand how discounters have positioned themselves within this theory." } ] }, { "parts": [ { "content": "One of the catalysts driving a volume discount pricing scheme is the availability of inexpensive goods. The NAFTA and other free trade agreements in the last generation have facilitated the promulgation of inexpensive goods to the United States from Mexico and other countries. The positive effect of these agreements was lower costs and increased competition and higher profit margins. In time, with costs low and the thirst for new and improved products high, planned obsolescence has become the norm in manufacturing. An item is produced with a higher margin, sold for a short time until a version release to replace it is created, then is liquidated at a volume discount price." } ], "rich_title": "Free Trade", "title": "Free Trade" }, { "parts": [ { "content": "An informed and thrifty customer also leads to volume discount pricing. The rise of \"extreme couponing,\" or buying in bulk using a host of coupons that drive a customers price to near zero, has increased the push for a volume discount pricing theory. A manufacturer and merchant, knowing the variety of coupons available, augmented with coupons from the manufacturer's website, accept a lower potential profit margin in exchange for a high turnover. 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Products do not stay shelved until liquidation requires even deeper price reduction." } ], "rich_title": "Inventory Management", "title": "Inventory Management" }, { "parts": [ { "content": "Economies of scale, meaning a large company having a reduced price of production caused by a greatly increased resource availability and buying power, has helped drive volume discount pricing. Discount stores, with hundreds or thousands of stores, can sell at a relatively low profit margin because they buy at such a high volume that they get the best price. They can even sell below cost, as competition dictates, until they win the price war and the other store either relents on the price or closes due to increased competition. They can negotiate with wholesalers easier, promising enormous purchasing in exchange for a lower margin." } ], "rich_title": "Economy of Scale Advantage", "title": "Economy of Scale Advantage" } ], "studio_article_id": "5168425", "studio_id": "6bf3b99b-a75c-46af-8be6-a8e5b1b17d94", "summary": "Volume discount pricing theory states that a firm can generate more net income by selling more items at a lower price than it can selling less items at a higher price. With the exponential boom of Wal-Mart, dollar concept stores and other discount stores in the 1970s and 1980s, small businesses are facing increased pressure from those who put this theory into practice. 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Part of that quest may cover things as diverse as the organization\u2019s accounting guidelines, policy manuals for record-keeping and reporting, and systems of checks and balances in the accounting department." } ] }, { "parts": [ { "content": "Bookkeeping guidelines enables a small business to convert its economic events from raw transactional data into financial information that investors can read to figure out how the company fared over a given period. To record transactions, a corporate bookkeeper debits and credits financial accounts, which run the gamut from equity items and assets to revenues, expenses and liabilities. Given the importance of record-keeping in a small-sized company's operational spectrum, managers often hires professionals with a specific skill set to run the accounting department. They reach out to applicants who have a depth of experience in all things accounting, a solid grasp of financial regulations, analytical dexterity and a gift for expedient compromise -- which is important, given that accountants interact with non-financial personnel to record and report operating information." } ], "rich_title": "Bookkeeping", "title": "Bookkeeping" }, { "parts": [ { "content": "A trial balance classifies all corporate accounts in two columns -- debit and credit -- and ensures that column totals are equal. A trial balance review is central in business accounting because it's the intermediary step between bookkeeping and financial statement preparation. Therefore, ensuring that this data summary is accurate goes a long way toward preventing mathematical inaccuracies in accounting statements and troubles that arise when regulators initiate investigations -- citing incorrect, non-compliant or fraudulent reporting." } ], "rich_title": "Trial Balance Review", "title": "Trial Balance Review" }, { "parts": [ { "content": "The controller of a small business sets proper policies to ensure that subordinates meet the important goal of financial statement preparation, which is the last internal phase before lifting the veil on the organization's performance. The controller checks that accountants prepare data summaries correctly and completely, making sure preparers' views of the company's performance are not at odds with what department heads and functional managers expect based on preliminary data reviews. A complete set of financial statements includes a balance sheet, a statement of profit and loss, a statement of cash flows and a statement of owners' equity." } ], "rich_title": "Financial Statement Preparation", "title": "Financial Statement Preparation" }, { "parts": [ { "content": "Regulatory compliance is one of the most significant aims of a small company's accounting function, especially if the business is a publicly traded entity that operates in various locales, files multijurisdictional reports and copes with regulatory tedium in many countries. The most important accounting regulations come from the Financial Accounting Standards Board, the U.S. Securities and Exchange Commission, the American Institute of Certified Public Accountants and the Public Company Accounting Oversight Board." } ], "rich_title": "Regulatory Compliance", "title": "Regulatory Compliance" } ], "studio_article_id": "5333243", "studio_id": "1cd1f01a-748d-4823-969c-4e7290533bfe", "summary": "When conceptual errors or mathematical inaccuracies find their way into a small company's financial statements, top leadership tries to find the root cause and asks department heads to review existing accounting procedures. 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Business Expense Reimbursement Excerpts of IRS Tax Code; February 2011", "url": "http://www.irs.gov/taxtopics/tc514.html" }, { "title": "\"Principles of Taxation for Business and Investment Planning, 2010\"; Sally Jones and Shelly Rhoades-Catanach; 2009" } ], "related_content_rcp": [ { "_id": "bizfluent.com/how-6146678-write-expense-report.html", "external_url": "bizfluent.com/how-6146678-write-expense-report.html", "image_url": "http://photos.demandstudios.com/getty/article/69/175/164665722.jpg", "title": "How to Write an Expense Report", "url": "bizfluent.com/how-6146678-write-expense-report.html" }, { "_id": "bizfluent.com/info-10063474-would-accrued-vacation-pay-reported-balance-sheet.html", "external_url": "bizfluent.com/info-10063474-would-accrued-vacation-pay-reported-balance-sheet.html", "image_url": "#", "title": "How Would Accrued Vacation Pay Be Reported on the Balance Sheet?", "url": "bizfluent.com/info-10063474-would-accrued-vacation-pay-reported-balance-sheet.html" }, { "_id": "bizfluent.com/13364016/how-to-track-employee-expense-receipts", "external_url": "bizfluent.com/13364016/how-to-track-employee-expense-receipts", "image_url": "http://photos.demandstudios.com/getty/article/151/175/87753547.jpg", "title": "How to Track Employee Expense Receipts", "url": "bizfluent.com/13364016/how-to-track-employee-expense-receipts" }, { "_id": "bizfluent.com/how-7319132-pay-employees-gas-mileage.html", "external_url": "bizfluent.com/how-7319132-pay-employees-gas-mileage.html", "image_url": "http://photos.demandstudios.com/getty/article/69/161/169280535.jpg", "title": "How to Pay Employees for Gas Mileage", "url": "bizfluent.com/how-7319132-pay-employees-gas-mileage.html" }, { "_id": "bizfluent.com/about-5406349-mileage-reimbursment-laws.html", "external_url": "bizfluent.com/about-5406349-mileage-reimbursment-laws.html", "image_url": "http://photos.demandstudios.com/getty/article/251/61/86526672.jpg", "title": "Mileage Reimbursement Laws", "url": "bizfluent.com/about-5406349-mileage-reimbursment-laws.html" }, { "_id": "bizfluent.com/how-12125301-calculate-salary-expense.html", "external_url": "bizfluent.com/how-12125301-calculate-salary-expense.html", "image_url": "#", "title": "How to Calculate Salary Expense", "url": "bizfluent.com/how-12125301-calculate-salary-expense.html" }, { "_id": "bizfluent.com/how-8470696-make-reimbursement-form.html", "external_url": "bizfluent.com/how-8470696-make-reimbursement-form.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/cache.gettyimages.com/818b9f54acaa4f0e85bdea7751b06a49.jpg", "title": "How to Make a Reimbursement Form", "url": "bizfluent.com/how-8470696-make-reimbursement-form.html" }, { "_id": "bizfluent.com/info-8782052-average-company-car-allowance.html", "external_url": "bizfluent.com/info-8782052-average-company-car-allowance.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/ae4b96ceadca403aa48b78c997defa0c.jpg", "title": "The Average Company Car Allowance", "url": "bizfluent.com/info-8782052-average-company-car-allowance.html" }, { "_id": "bizfluent.com/about-6374884-employee-tuition-reimbursement-taxes.html", "external_url": "bizfluent.com/about-6374884-employee-tuition-reimbursement-taxes.html", "image_url": "http://photos.demandstudios.com/getty/article/92/130/135551701.jpg", "title": "Employee Tuition Reimbursement & Taxes", "url": "bizfluent.com/about-6374884-employee-tuition-reimbursement-taxes.html" }, { "_id": "bizfluent.com/facts-7531115-company-car-vs-private-car.html", "external_url": "bizfluent.com/facts-7531115-company-car-vs-private-car.html", "image_url": "http://photos.demandstudios.com/184/228/fotolia_4154573_XS.jpg", "title": "Company Car Vs. 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In many cases, this applies when an employee spends money on a business trip. Examples of typical business expenses include necessities such as food, lodging and transportation. According to IRS code, a business expense reimbursement can sometimes count as income." } ] }, { "parts": [ { "content": "Many companies have expense reimbursement policies that set a maximum daily expense reimbursement per employee. The IRS considers those maximum allowance amounts for lodging, meals and transportation a per diem amount. Should the employee spend more than this per diem amount, the employee will normally have to pay that extra expense out of pocket since a company will not reimburse expenses above this maximum amount." } ], "rich_title": "Policies", "title": "Policies" }, { "parts": [ { "content": "Usually, businesses require employees to turn in expense reimbursement receipts shortly after incurring the expense. This allows the company to maintain up-to-date bookkeeping and tax reporting regarding employee expense reimbursement. Many companies have specific policies that specify an exact time frame for turning in receipts, such as one week or one month. Many companies also require employees to file an expense report using a specific style or template. This expense spreadsheet details how the employee incurred expenses, the amount of the expenses and the reason for each expense." } ], "rich_title": "Receipts", "title": "Receipts" }, { "parts": [ { "content": "The IRS requires employers to maintain proof of reimbursement expenses deducted on company tax returns. If the employee receives expense reimbursement from the employer and cannot provide receipts or other documentation to back up the reimbursement, the IRS will consider the reimbursement taxable income for the employee. Unsubstantiated reimbursements can also cause the IRS to disallow deducted expenses from the employer\u2019s tax return. Unsubstantiated reimbursements should appear as taxable income paid by the employer on the employee\u2019s W-2 Form." } ], "rich_title": "Additional Income", "title": "Additional Income" }, { "parts": [ { "content": "Before incurring a business expense, many companies want employees to receive pre-authorization for the future expenses. Even though this pre-authorization represents an estimate of expected expenses, this process can help an employee to manage expenses. The money employers pay employees as reimbursement for substantiated business expenses is not subject to employment tax or income tax." } ], "rich_title": "No Income Tax", "title": "No Income Tax" } ], "studio_article_id": "5365419", "studio_id": "8bc59b1c-7eb2-44ad-9d55-892db84fb13a", "summary": "A business expense reimbursement occurs when the employer refunds business expenses initially paid by employees. In many cases, this applies when an employee spends money on a business trip. Examples of typical business expenses include necessities such as food, lodging and transportation. 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"http://photos.demandstudios.com/getty/article/251/15/78053928.jpg", "thumburl": "http://cache.gettyimages.com/xt/78053928.jpg?v=1&g=fs1|0|COM|53|928&s=1", "url": "http://photos.demandstudios.com/getty/article/251/15/78053928.jpg", "width": 2555, "x": "1" }, "keywords": [ "Chapter 11 reorganization", "bankruptcy restructuring plan", "money owed restructuring", "debt payments bankruptcy" ], "last_updated": "2019-06-04T15:55:19.027000", "level": 2, "meta": { "embeds": 0, "images": 1, "sections": 4, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 416 }, "og_title": "What Happens to Money Owed in a Business Restructuring Plan?", "original_published_date": "2011-09-05T01:42:00", "owning_domain": "bizfluent.com", "page_title": "What Happens to Money Owed in a Business Restructuring Plan?", "parent_category": "bizfluent.com/accounting/", "pub_date": "2011-09-04T18:42:00", "readability": "14", "references": [ { "_id": 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"bizfluent.com/info-7938337-california-code-226e-statute-limitations.html" }, { "_id": "bizfluent.com/info-10032673-file-contractor-did-not-pay-subcontractor.html", "external_url": "bizfluent.com/info-10032673-file-contractor-did-not-pay-subcontractor.html", "image_url": "http://photos.demandstudios.com/getty/article/154/147/89967708.jpg", "title": "What Do You File if a Contractor Did Not Pay a Subcontractor?", "url": "bizfluent.com/info-10032673-file-contractor-did-not-pay-subcontractor.html" }, { "_id": "bizfluent.com/about-4676223-what-structured-settlement.html", "external_url": "bizfluent.com/about-4676223-what-structured-settlement.html", "image_url": "https://cpi.studiod.com/www_ehow_com/i.ehow.com/images/a04/em/jv/what-structured-settlement-800x800.jpg", "title": "What Is a Structured Settlement?", "url": "bizfluent.com/about-4676223-what-structured-settlement.html" }, { "_id": "bizfluent.com/how-6806965-collect-debt-employees.html", "external_url": "bizfluent.com/how-6806965-collect-debt-employees.html", "image_url": "https://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/20/65/fotolia_1971954_XS.jpg", "title": "How to Collect Debt From Employees", "url": "bizfluent.com/how-6806965-collect-debt-employees.html" }, { "_id": "bizfluent.com/how-8617494-start-pawn-shop-arkansas.html", "external_url": "bizfluent.com/how-8617494-start-pawn-shop-arkansas.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/cache.gettyimages.com/cb604e02f30d4dda95460b4b71ffe590.jpg", "title": "How to Start a Pawn Shop in Arkansas", "url": "bizfluent.com/how-8617494-start-pawn-shop-arkansas.html" }, { "_id": "bizfluent.com/about-4697312-sheet-versus-profit-loss-statement.html", "external_url": "bizfluent.com/about-4697312-sheet-versus-profit-loss-statement.html", "image_url": "http://photos.demandstudios.com/getty/article/232/102/465489357.jpg", "title": "What Is the Difference Between a Balance Sheet Versus a Profit & Loss Statement?", "url": "bizfluent.com/about-4697312-sheet-versus-profit-loss-statement.html" } ], "sections": [ { "parts": [ { "image": { "alttext": "...", "aspectratio": 0.6671018276762402, "attributionhtml": "Thinkstock/Comstock/Getty Images", "caption": "The U.S. Bankruptcy Court appoints trustees in some Chapter 11 cases.", "credit": "Thinkstock/Comstock/Getty Images", "guid": "null", "height": 3830, "photoid": "getty/78053928", "thumburl": "http://cache.gettyimages.com/xt/78053928.jpg?v=1&g=fs1|0|COM|53|928&s=1", "url": "http://photos.demandstudios.com/getty/article/251/15/78053928.jpg", "width": 2555, "x": "1" } }, { "content": "Restructuring plans are a requirement for businesses that file bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. Chapter 11 bankruptcy allows a business to continue operations under a court-approved reorganization or restructuring plan for paying debts. Once a business owner files for Chapter 11 bankruptcy, a \u201cstay\u201d prohibits actions by creditor to collect debts. After a plan is in place, the bankruptcy codes and the business\u2019 reorganization plan guide disposition of money owed to the business or to creditors." } ] }, { "parts": [ { "content": "After filing a Chapter 11 bankruptcy case a business has 120 days to create and file a voluntary reorganization plan and provide disclosure statements to creditors. Creditors evaluate, approve or reject the plan. The bankruptcy court confirms or rejects the plan. The reorganization plan allows the business to pay portions of debts, discharge some debts, terminate contracts and recover assets. The plan details the process for the business to adjust operations, reduce debt and return to profitable operations. Small business cases are handled differently than bankruptcy cases for larger business, including additional court oversight and attention to the reorganization plan and business operations." } ], "rich_title": "Reorganization Plan", "title": "Reorganization Plan" }, { "parts": [ { "content": "Confirmed reorganization plans are legally binding for creditors and the debtor that has filed bankruptcy. A confirmed plan discharges debt that existed before the confirmation date. The plan classifies debtors as secured creditors, equity security holders and general or prioritized unsecured creditors. The plan includes a detailed payment plan for repayment of debts and, if approved, liquidation of assets. Reorganization plans may be adjusted or replaced with new plans after voting by creditors and approval of the bankruptcy court. The business must adhere to payment schedules in the reorganization plan." } ], "rich_title": "Confirmed Plans", "title": "Confirmed Plans" }, { "parts": [ { "content": "Bankruptcy law prohibits businesses in Chapter 11 reorganization to pay for services or goods the business received before the filing date for the bankruptcy case. Pre-petition invoices cannot be paid until the court approves a reorganization plan. Post-petition invoices for purchases made after the filing of the bankruptcy are paid normally and receive priority over pre-petition debts. The reorganization plan details how much of pre-petition debts are paid and when the debts are paid." } ], "rich_title": "Pre-petition Debts", "title": "Pre-petition Debts" }, { "parts": [ { "content": "Bankruptcy does not allow the discharge of some of the business\u2019 debts, including certain taxes, child support, alimony, government-guaranteed education funds, some orders for restitution and debts stemming from personal and property damage of a malicious nature or involving intoxication. A creditor may file a petition to declare non-dischargeable those debts related to assets obtained under false pretenses or through fraud." } ], "rich_title": "Non-discharged Debts", "title": "Non-discharged Debts" } ], "studio_article_id": "5443605", "studio_id": "2833141f-5e5e-4600-a492-3d36163a7e96", "summary": "Restructuring plans are a requirement for businesses that file bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. Chapter 11 bankruptcy allows a business to continue operations under a court-approved reorganization or restructuring plan for paying debts. Once a business owner files for Chapter 11 bankruptcy, a “stay” prohibits actions by creditor to collect debts. After a plan is in place, the bankruptcy codes and the business’ reorganization plan guide disposition of money owed to the business or to creditors.", "tags": [], "thumbnail": "http://photos.demandstudios.com/getty/article/251/15/78053928.jpg", "title": "What Happens to Money Owed in a Business Restructuring Plan?", "title_id": 13312826, "type": "Article", "url": "/13312826/what-happens-to-money-owed-in-a-business-restructuring-plan", "writer": "www.demandstudios.com/contributor/d7ee9ea2-9685-4087-ab54-fce6e2067412" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13312828/goals-of-business-budgeting", "_id": "bizfluent.com/13312828/goals-of-business-budgeting", "_last_updated": "2019-06-04T15:55:18.872000", "_type": "document", "_url": "http://bizfluent.com/13312828/goals-of-business-budgeting", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": 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"http://www.score.org/resources/5-tips-budgeting" }, { "_id": "http://www.entrepreneur.com/article/201670", "external_url": "http://www.entrepreneur.com/article/201670", "title": "Entrepreneur; How to Create a Simple Budget; Joseph Benoit; May 2009", "url": "http://www.entrepreneur.com/article/201670" } ], "related_content_rcp": [ { "_id": "bizfluent.com/how-5817237-write-pro-forma-statement.html", "external_url": "bizfluent.com/how-5817237-write-pro-forma-statement.html", "image_url": "http://photos.demandstudios.com/getty/article/189/183/83017290.jpg", "title": "How to Write a Pro Forma Statement", "url": "bizfluent.com/how-5817237-write-pro-forma-statement.html" }, { "_id": "bizfluent.com/how-10017926-make-financial-projection.html", "external_url": "bizfluent.com/how-10017926-make-financial-projection.html", "image_url": "http://photos.demandstudios.com/getty/article/97/229/89680687.jpg", "title": "How to Make a Financial Projection", "url": 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Project Budget", "url": "bizfluent.com/12740800/how-to-develop-a-project-budget" }, { "_id": "bizfluent.com/how-5950295-define-financial-stability-business.html", "external_url": "bizfluent.com/how-5950295-define-financial-stability-business.html", "image_url": "http://photos.demandstudios.com/getty/article/34/183/83253172.jpg", "title": "How to Define Financial Stability in Business", "url": "bizfluent.com/how-5950295-define-financial-stability-business.html" }, { "_id": "bizfluent.com/13709409/define-your-budget-for-your-business", "external_url": "bizfluent.com/13709409/define-your-budget-for-your-business", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/4fb44a1da7aa44799df49d66ea626474", "title": "Define Your Budget for Your Business", "url": "bizfluent.com/13709409/define-your-budget-for-your-business" } ], "sections": [ { "parts": [ { "image": { "alttext": "...", "aspectratio": 0.6691666666666667, "attributionhtml": "Jupiterimages/Photos.com/Getty Images", "caption": "Use a budget to set goals, track them and adjust them if necessary.", "credit": "Jupiterimages/Photos.com/Getty Images", "height": 3600, "photoid": "getty/87789926", "thumburl": "http://cache.gettyimages.com/xt/87789926.jpg?v=1&g=fs1|0|PHC|89|926&s=1", "url": "http://photos.demandstudios.com/getty/article/170/239/87789926.jpg", "width": 2409, "x": "1" } }, { "content": "Small businesses should create and use budgets to do more than simply keep track of their income and expenses. Budgets can help businesses project profits, spot potential problems and opportunities as the year progresses, make adjustments to maintain financial stability and show potential investors or lenders proof of the businesses\u2019 financial potential." } ] }, { "parts": [ { "content": "The first goal of a small business budget should be to project how the business will perform financially under a variety of scenarios. Project fixed expenses, such as rent, salaries, insurance premiums and loan payments. Estimate recurring variable expenses, such as utilities, office expenses and Internet costs. Estimate variable costs tied to sales, such as the amount of materials needed to make a product or labor necessary to bring a product or service to market. A budget allows you to compare your costs under several different revenue projections. This will allow you to forecast your material and labor needs as you grow." } ], "rich_title": "Make Projections", "title": "Make Projections" }, { "parts": [ { "content": "After you create the first draft of your budget, plugging in all of your expected costs and comparing those under different sales scenarios, adjust your spending projections to help you achieve a profit." } ], "rich_title": "Set Spending", "title": "Set Spending" }, { "parts": [ { "content": "Most small businesses don\u2019t make immediate profits. Once you pay off initial investments in equipment, real estate, extra marketing or other purchases you won\u2019t have long-term, you can estimate when you will start making a profit and how much capital you will need to run the company until it is profitable." } ], "rich_title": "Determine Break Even", "title": "Determine Break Even" }, { "parts": [ { "content": "When you know your costs to run your business, you can set the prices for your products or services. A budget helps you identify non-manufacturing costs, such as overhead, debt service, professional fees and other costs you incur. Knowing your exact expenses will help you set realistic prices." } ], "rich_title": "Set Prices", "title": "Set Prices" }, { "parts": [ { "content": "A critical goal of budgeting is to create a document you can update and examine each month to see if you are meeting your financial goals. Without a budget, you may not know your income is not covering your expenses until you are deep in financial debt. Using a budget to track your performance will allow you to make real-time adjustments to your business model, rather than waiting until the end of the year." } ], "rich_title": "Track Progress and Make Adjustments", "title": "Track Progress and Make Adjustments" }, { "parts": [ { "content": "If you want to attract investment capital, secure loans from banks or obtain lines of credits from suppliers, you may need proof that you are able to pay your bills and debts. Some lenders require only that you secure your loan or credit line with collateral, such as your building, machinery or goodwill. Investors and banks may want to see your business plan, which should include budget projections and your current, up-to-date budget." } ], "rich_title": "Secure Capital", "title": "Secure Capital" } ], "studio_article_id": "5441428", "studio_id": "ae82d347-74b7-44b7-9b13-210c78f15532", "summary": "Small businesses should create and use budgets to do more than simply keep track of their income and expenses. 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profits can tell you a lot about your pricing strategy.", "credit": "Thinkstock/Comstock/Getty Images", "height": 1527, "photoid": "getty/92573033", "thumburl": "http://cache.gettyimages.com/xt/92573033.jpg?v=1&g=fs1|0|COM|73|033&s=1", "url": "http://photos.demandstudios.com/getty/article/103/5/92573033.jpg", "width": 2289, "x": "1" } }, { "content": "Not knowing the difference between your gross profit and your gross receipts will not only leave you in a bit of a pickle when you have to do your year-end accounts, it\u2019s also likely to mean that you don't have a firm understanding of your company's profitability. Familiarizing yourself with the meaning of these terms will shed a great deal of light on the health of your business." } ] }, { "parts": [ { "content": "Gross profit is the amount of money a business makes on a sale. You can calculate the gross profit that your company makes on an individual sale by subtracting the sale price of an item from its cost price. So, if you bought an item to sell in your store for $5 and sold it for $8, your gross profit would be $3. Your gross profit for an accounting period is the sum total of the gross profit made on all your sales. Gross profit is not a good barometer of a company's profitability, as it doesn't factor in overheads such as staffing, tax, rent and other costs." } ], "rich_title": "Gross Profit", "title": "Gross Profit" }, { "parts": [ { "content": "Gross receipts are the total of all the payments made to your company in an accounting period, without any deductions. 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PPE & Long-Term Investments in Stock", "url": "bizfluent.com/info-8238566-distinguish-ppe-longterm-investments-stock.html" }, { "_id": "bizfluent.com/info-8154458-do-debit-credit-liability-increase.html", "external_url": "bizfluent.com/info-8154458-do-debit-credit-liability-increase.html", "image_url": "#", "title": "Do You Debit or Credit a Liability to Increase It?", "url": "bizfluent.com/info-8154458-do-debit-credit-liability-increase.html" } ], "sections": [ { "parts": [ { "content": "Investors appreciate it when a company draws sharp distinctions with rivals, showcasing its ability to innovate by the day and propose products that customers want. To boost innovation and technological advance, the business must hire competent candidates, pay them competitively and properly track pay data, including accrued payroll and bonuses due." } ] }, { "parts": [ { "content": "The term \"payroll' in accrued payroll refers to salary expense a business incurs. If you look into a financial lexicon, phrases such as \"salaries expense,\" \"compensation cost,\" \"labor charge\" and \"payroll expense\" are interchangeable. They all refer to money an organization doles out periodically to reward the physical and intellectual efforts of personnel, doing so in accordance with labor agreements and regulatory guidelines. Accrued payroll means cash a business hasn't paid employees at the reporting date because of a timing difference. For example, if the company's pay cycle falls on the 15th and 30th day of every month, it will accumulate -- or accrue -- payroll charges if it reports financial statements on the 25th day of the month." } ], "rich_title": "Definition", "title": "Definition" }, { "parts": [ { "content": "To accrue payroll, a corporate bookkeeper debits the salaries expense account and credits the salaries payable -- or accrued payroll -- account. When the company pays employees, the bookkeeper credits the cash account and debits the salaries payable account to bring it back to zero. In financial terminology, debiting cash -- an asset account -- means increasing funds in operating vaults. Accrued payroll is a short-term debt because a company typically must settle compensation debts within 12 months -- a time frame that may too remote from an operational reality that usually calls for payments within a few days." } ], "rich_title": "Bookkeeping", "title": "Bookkeeping" }, { "parts": [ { "content": "As a current liability -- the other term for a short-term debt -- accrued payroll is integral to a statement of financial position, also known as a balance sheet or report on financial condition. The cash account also flows into a corporate balance sheet, specifically in the \"short-term assets\" section. Salaries expense is part of the \"selling, general and administrative charges\" section of a statement of profit and loss, the data synopsis accountants often call an income statement or P&L." } ], "rich_title": "Financial Reporting", "title": "Financial Reporting" }, { "parts": [ { "content": "To track and settle accrued payroll on time, a company uses technology. The tools of the trade run the gamut from enterprise resource planning software and content workflow programs to document management software and financial analysis applications. Other tools include Information retrieval or search software, mainframe computers, accounts receivable and payable management applications, and calendar and scheduling software." } ], "rich_title": "Tools", "title": "Tools" } ], "studio_article_id": "5506661", "studio_id": "7ac20aa2-b868-4222-a8a7-e41528aaa124", "summary": "Investors appreciate it when a company draws sharp distinctions with rivals, showcasing its ability to innovate by the day and propose products that customers want. To boost innovation and technological advance, the business must hire competent candidates, pay them competitively and properly track pay data, including accrued payroll and bonuses due.", "tags": [], "title": "What Kind of Account Is Accrued Payroll?", "title_id": 13314979, "type": "Article", "url": "/13314979/what-kind-of-account-is-accrued-payroll", "writer": "www.demandstudios.com/contributor/d4e0511b-5699-4578-8327-0c352806ac94" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13316953/gross-margin-reporting-management", "_id": "bizfluent.com/13316953/gross-margin-reporting-management", "_last_updated": "2019-06-04T15:55:18.659000", "_type": "document", "_url": "http://bizfluent.com/13316953/gross-margin-reporting-management", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13316953/gross-margin-reporting-management", "fixed_category": [ { 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"http://www.moneychimp.com/glossary/gross_margin.htm", "external_url": "http://www.moneychimp.com/glossary/gross_margin.htm", "title": "Money Chimp: Gross Profit Margin", "url": "http://www.moneychimp.com/glossary/gross_margin.htm" }, { "_id": "http://blog.accountingcoach.com/gross-profit-method-estimate-inventory/", "external_url": "http://blog.accountingcoach.com/gross-profit-method-estimate-inventory/", "title": "Accounting Coach: What is the Gross Profit Method?", "url": "http://blog.accountingcoach.com/gross-profit-method-estimate-inventory/" }, { "_id": "http://blog.bodellconsulting.com/2009/06/04/how-can-i-use-gross-profit-pricing-for-a-new-restaurant/", "external_url": "http://blog.bodellconsulting.com/2009/06/04/how-can-i-use-gross-profit-pricing-for-a-new-restaurant/", "title": "Bodell Consulting: How can I use gross profit pricing for a new restaurant?", "url": "http://blog.bodellconsulting.com/2009/06/04/how-can-i-use-gross-profit-pricing-for-a-new-restaurant/" } ], 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referred to as gross profit margin, is a metric used in financial reporting to help companies gauge the overall financial health of their organization. The most common use of gross margin reporting is to assess an organization's additional expenses and savings potential." } ] }, { "parts": [ { "content": "Gross margin is determined by subtracting total revenue from operating expenses, or cost of goods sold, and dividing this result by total revenue. Particularly efficient companies that spend less on creating their goods will have higher profit margins. Conversely, companies that spend at or near the amount for which they sell their product to produce their product will have slim profit margins and less money to reinvest in their company." } ], "rich_title": "Gross Margin Explained", "title": "Gross Margin Explained" }, { "parts": [ { "content": "Gross margin provides managers excellent illumination into the direct impact of company expenditures on their bottom line. When utilized to gauge a range of products in a company's manufacturing or production portfolio, gross margin can indicate which products are more profitable than others. Analysis of costs and production expenses can allow companies to target production saving initiatives such as alternative means of sourcing, manufacturing and assembly." } ], "rich_title": "Affect on Costs and Expenses", "title": "Affect on Costs and Expenses" }, { "parts": [ { "content": "Gross margin reporting can save companies money by spurring them to shrink production overhead. Similarly, gross margin reporting can be utilized to target competition, particularly when margins are large. A company's ability to shrink the cost of its product on the consumer market can lead to increased sales, which by increasing total revenue can also positively impact gross profit margins. Companies that can produce their goods for less and sell more of them to target markets at a lower price have a distinctive advantage over their competitors." } ], "rich_title": "Advantages in Business Management", "title": "Advantages in Business Management" }, { "parts": [ { "content": "Gross margin's major drawback is that it is simply an estimate. More dynamic metrics are needed to gauge more precise analysis regarding a company's overall profitability. While gross margin is inclusive of total production cost, it is not inclusive of other production-related expenses including packaging, shipping costs or shipping insurance, all costs which company management must consider when gauging their overall profitability." } ], "rich_title": "Drawbacks in Business Management", "title": "Drawbacks in Business Management" } ], "studio_article_id": "5581157", "studio_id": "4f87c427-3d35-47df-ac28-290baef05bb0", "summary": "Gross margin, also referred to as gross profit margin, is a metric used in financial reporting to help companies gauge the overall financial health of their organization. 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"bizfluent.com/facts-7207187-commercial-enterprise-.html", "image_url": "#", "title": "What Is a Commercial Enterprise?", "url": "bizfluent.com/facts-7207187-commercial-enterprise-.html" }, { "_id": "bizfluent.com/info-12089041-net-sales-revenue-vs-net-income.html", "external_url": "bizfluent.com/info-12089041-net-sales-revenue-vs-net-income.html", "image_url": "#", "title": "Net Sales or Revenue vs. Net Income", "url": "bizfluent.com/info-12089041-net-sales-revenue-vs-net-income.html" } ], "sections": [ { "parts": [ { "content": "Retail is that sector of the economy focusing on the direct sales of already manufactured goods to the public. For the sake of economic thinking, the different categories and subcategories of the economy are separated out, defined and analyzed. Since the economy is a large and complex concept, it needs to be broken down into different sectors. Retail is significant because this is the real interface between the consumer and the economic system as a whole. The concept of a consumer's wants and needs comes face to face with prices, or the expression of supply and demand." } ] }, { "parts": [ { "content": "Retail is that sector of the economy focusing on the direct sales of already manufactured goods to the public. For the sake of economic thinking, the different categories and subcategories of the economy are separated out, defined and analyzed. Since the economy is a large and complex concept, it needs to be broken down into different sectors. Retail is significant because this is the real interface between the consumer and the economic system as a whole. The concept of a consumer's wants and needs comes face to face with prices, or the expression of supply and demand." } ], "rich_title": "Basics", "title": "Basics" }, { "parts": [ { "content": "Motor vehicles is one major subcategory. This includes both the sales and maintenance of cars and trucks. Another is gasoline and fuel products, that have their own subcategory. Because fuel is so foundational to modern economies --especially oil prices -- gasoline stations and fuel costs in general have their own category." } ], "rich_title": "Vehicles and Fuel", "title": "Vehicles and Fuel" }, { "parts": [ { "content": "Furniture, according to the Census Bureau, is its own subcategory, and this includes all home furnishings. This also includes all aspects of home improvement such as hardware stores and all retail outlets that deal primarily with home related projects and maintenance. The fourth category is electronics, which is a very large category taking into considerations all forms of computers, music players and supportive and complimentary retail outlets. This does not include games. Games, sports, hobby and book stores are a fifth subcategory of retail trade and all three areas of retail are considered as a single specialty." } ], "rich_title": "Furniture, Electronics and Games", "title": "Furniture, Electronics and Games" }, { "parts": [ { "content": "Sixth, food and grocery stores are a category of retail that deals both with buying food that needs to be prepared at home, and food that is already prepared such as in a restaurant or a school cafeteria. This of course, also includes drinks such as alcohol served in bars or sodas that come out of a machine." } ], "rich_title": "Food and Drink", "title": "Food and Drink" }, { "parts": [ { "content": "Clothing is a separate category, dealing with all retail outlets that specialize in apparel, including shoe stores and anything related to the direct sales of textile products. Health and personal care -- so called health and beauty aids -- have their own category, as does \u201cgeneral merchandise,\u201d which would include all retail outlets that do not have a specific specialty and are large enough to offer a bit of everything." } ], "rich_title": "Clothing, Health and General Merchandise", "title": "Clothing, Health and General Merchandise" } ], "studio_article_id": "5864351", "studio_id": "fe30a3b8-3484-48d1-8397-b4c74dcd42db", "summary": "Retail is that sector of the economy focusing on the direct sales of already manufactured goods to the public. 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"#", "title": "What Happens If a Financial Statement Transaction Is Not Recorded?", "url": "bizfluent.com/info-8327375-happens-statement-transaction-not-recorded.html" }, { "_id": "bizfluent.com/how-10075183-write-ledger.html", "external_url": "bizfluent.com/how-10075183-write-ledger.html", "image_url": "http://photos.demandstudios.com/getty/article/78/62/87460143.jpg", "title": "How to Write a Ledger", "url": "bizfluent.com/how-10075183-write-ledger.html" } ], "sections": [ { "parts": [ { "image": { "alttext": "tungsten close-up of a man filling out a cheque form his cheque book", "aspectratio": 1.5070821529745042, "attributionhtml": "Stockbyte/Stockbyte/Getty Images", "attributionlink": "", "attributiontext": "Stockbyte/Stockbyte/Getty Images", "caption": "Time spent tranferring accounting entries can be cut significantly.", "credit": "Stockbyte/Stockbyte/Getty Images", "height": 1412, "licensetype": "RF", "photoguid": null, "photoid": "getty/57437847", "photosource": null, "summary": "tungsten close-up of a man filling out a cheque form his cheque book", "thumbheight": 0, "thumburl": "http://cache.gettyimages.com/xt/57437847.jpg?v=1&g=fs1|0|STK|37|847&s=1", "thumbwidth": 0, "title": "tungsten close-up of a man filling out a cheque form his cheque book", "url": "http://photos.demandstudios.com/getty/article/178/169/57437847.jpg", "width": 2128 } }, { "content": "Accounting transactions can appear complicated to the business owner or those new to the record-keeping and accounting field. Generally accepted accounting principles, or GAAP, require that businesses and accountants use the double-entry method for accounting for transactions. Transactions are transferred from the general journal and other accounts to the general ledger. The general ledger is then used to provide information found in the income statement and balance sheet. To cut down on time constraints, finding a method for summarizing transactions and transferring them to the general ledger is recommended." } ] }, { "parts": [ { "content": "Generally speaking, the sooner you summarize the transaction that will go into the general ledger, the better. The reason for this is that the entries recorded in the general journal in a chronological fashion need to be transferred as accurately as possible. The more time that lapses between the original entry and the time you transfer it to the general ledger, the more potential for error there is." } ], "rich_title": "Timing", "title": "Timing" }, { "parts": [ { "content": "The content of your summaries can be anything that makes sense within the context of general journal and ledger entries. One important thing to remember is that the entry needs to accurately reflect the reason that the transaction took place. A one sentence summary will generally suffice, but on occasion you may need to use more than sentence to accurately reflect the transaction. You can always shorten the entry from general journal or other sources." } ], "rich_title": "Content", "title": "Content" }, { "parts": [ { "content": "Shortening the original entry is probably the fastest method of summarizing the statement that you post in the general ledger. If your general journal entry was two sentences long, you may be able to shorten it to a compound sentence in the general ledger. You may even be able to go so far as to narrow down the entry to a few key words and eliminate any unnecessary wording in the process. For instance, an entry that originally read \"payment to accounts receivable made by John Smith company on 12-1-11 for cost of xyz goods\" could be shortened to \"acct. rec. John Smith, 12-1-11, xyz.\"" } ], "rich_title": "Abbreviating", "title": "Abbreviating" }, { "parts": [ { "content": "Another way to eliminate some of the work associated with making the transfer from the general journal or another source to the general ledger is to do so using software programs. For instance, companies have accounting software packages that allow you to instantly transfer the information from one place in your accounting records to another. As long as you record the information electronically as you receive it, you can make the transfer contemporaneously with the original entry an not have to worry about shortening the entry to save time or space." } ], "rich_title": "Electronic Transfers", "title": "Electronic Transfers" } ], "studio_article_id": "5864465", "studio_id": "8bcf0e0a-c74e-4e8e-a77c-a0d869153c04", "summary": "Accounting transactions can appear complicated to the business owner or those new to the record-keeping and accounting field. Generally accepted accounting principles, or GAAP, require that businesses and accountants use the double-entry method for accounting for transactions. Transactions are transferred from the general journal and other accounts to the general ledger. The general ledger is then used to provide information found in the income statement and balance sheet. To cut down on time constraints, finding a method for summarizing transactions and transferring them to the general ledger is recommended.", "tags": [], "thumbnail": "http://photos.demandstudios.com/getty/article/178/169/57437847.jpg", "title": "What Method Would You Use to Summarize Transactions & Transfer to the Ledger?", "title_id": 13325493, "type": "Article", "url": "/13325493/what-method-would-you-use-to-summarize-transactions-transfer-to-the-ledger", "writer": "www.demandstudios.com/contributor/42362757-a73b-442b-805c-25d28b81fb2c" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "_id": "bizfluent.com/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "_last_updated": "2019-06-04T15:55:19.177000", "_type": "document", "_url": "http://bizfluent.com/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Freestyle", "id": "bizfluent.com/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "image": {}, "keywords": [ "balancing government budget", "how economy works", "flow of money", "Keysian economics" ], "last_updated": "2019-06-04T15:55:19.177000", "level": 2, "meta": { "embeds": 0, "images": 0, "sections": 4, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 371 }, "og_title": "What Is the Leakage Out of the Circular Flow of Income?", 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"sections": [ { "parts": [ { "content": "The economy has a circle life much like nature. Money flows in a circular manner through consumers and businesses in an ideal system, but in reality all flows of income have leaks. Tracking the flow of money and finding leaks may help small businesses plan for significant policy changes and anticipate how the government may try to balance its budget." } ] }, { "parts": [ { "content": "In a closed circular income stream, money flows continuously from firms to households. Households spend all of their money on goods and businesses spend all of their money on labor and expansion. The basic model of the circular flow of income ignores common consumer actions that take money out of the circular of income, or leakage. For instance, most households save money and some companies retain earnings." } ], "rich_title": "Leakage", "title": "Leakage" }, { "parts": [ { "content": "Net taxes are the second largest cause of leakage in the circular flow of income in a system closed off from the rest of the world. Income taxes, property taxes and payroll taxes go directly to the government. However, the government frequently injects taxes back into the circular flow of income. For instance, government pays billions of dollars each month in pensions and Social Security checks. The government also spends tax dollars on projects for the public good, such as parks and roads." } ], "rich_title": "Taxes", "title": "Taxes" }, { "parts": [ { "content": "Ultimately, a government must balance its leaks with inflows of cash. This often happens by increasing exports or borrowing money from foreign governments and investors. In some cases, such as with the United States during the 1990s and '00s, a government depends entirely on foreign investment. For instance, imports grew from 1 percent to 6 percent of total domestic production between 1991 and 2005. In addition, the government spent more than it received in taxes. The only way the U.S. could balance leakage in the economy was to acquire foreign investment." } ], "rich_title": "Effect", "title": "Effect" }, { "parts": [ { "content": "Small businesses should pay attention to key monetary metrics, such as government spending, consumer confidence and interest rates. For instance, if the government wants consumers to purchase more goods and inject money into the economy, it often lowers interest rates so consumers can purchase goods on credit. If the government wants to lower its deficit, it may raise taxes on businesses or eliminate some spending programs." } ], "rich_title": "Considerations", "title": "Considerations" } ], "studio_article_id": "5864601", "studio_id": "e662c796-6ad2-45b7-bfb5-adbfb3d53bde", "summary": "The economy has a circle life much like nature. Money flows in a circular manner through consumers and businesses in an ideal system, but in reality all flows of income have leaks. Tracking the flow of money and finding leaks may help small businesses plan for significant policy changes and anticipate how the government may try to balance its budget.", "tags": [], "title": "What Is the Leakage Out of the Circular Flow of Income?", "title_id": 13325562, "type": "Article", "url": "/13325562/what-is-the-leakage-out-of-the-circular-flow-of-income", "widget_stats": { "thumb": { "-1": 0, "1": 1 } }, "writer": "www.demandstudios.com/contributor/8de5e0c7-63ca-4361-8770-321f8ed57a22" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13325629/example-of-an-adjusted-trial-balance-sheet", "_id": "bizfluent.com/13325629/example-of-an-adjusted-trial-balance-sheet", "_last_updated": "2019-06-04T15:55:19.157000", "_type": "document", "_url": "http://bizfluent.com/13325629/example-of-an-adjusted-trial-balance-sheet", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13325629/example-of-an-adjusted-trial-balance-sheet", "fixed_category": [ { "_id": "/finance-your-business/", "external_url": "/finance-your-business/", "title": "Finance Your Business", "url": "/finance-your-business/" }, { "_id": "/accounting/", "external_url": "/accounting/", "title": "Accounting", "url": "/accounting/" } ], "format": "Freestyle", "id": "bizfluent.com/13325629/example-of-an-adjusted-trial-balance-sheet", "image": { "_id": "http://photos.demandstudios.com/getty/article/110/102/92572372.jpg", "alttext": "Accounting document", "aspectratio": 0.6671035386631717, "attributionhtml": "Thinkstock/Comstock/Getty Images", "attributionlink": "", "attributiontext": "Thinkstock/Comstock/Getty Images", "caption": "Make an adjusted trial balance sheet for accurate books.", "credit": "Thinkstock/Comstock/Getty Images", "external_url": "http://photos.demandstudios.com/getty/article/110/102/92572372.jpg", "height": 2289, "licensetype": "RF", "photoguid": null, "photoid": "getty/92572372", "photosource": null, "summary": "Accounting document", "thumbheight": 0, "thumbnail_url": "http://photos.demandstudios.com/getty/article/110/102/92572372.jpg", "thumburl": "http://cache.gettyimages.com/xt/92572372.jpg?v=1&g=fs1|0|COM|72|372&s=1", "thumbwidth": 0, "title": "Accounting document", "url": "http://photos.demandstudios.com/getty/article/110/102/92572372.jpg", "width": 1527 }, "keywords": [ "creating balance sheets", "adjusting entries", "adjusted trial balance" ], "last_updated": "2019-06-04T15:55:19.157000", "level": 2, "meta": { "embeds": 0, "images": 1, "sections": 4, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 422 }, "og_title": "Example of an Adjusted Trial Balance Sheet", "original_published_date": "2011-12-26T03:59:00", "owning_domain": "bizfluent.com", "page_title": "Example of an Adjusted Trial Balance Sheet", "parent_category": "bizfluent.com/accounting/", "pub_date": "2011-12-25T21:32:06.783000", "readability": "9", "references": [ { "_id": "http://business-accounting-guides.com/trialbalance/", "external_url": "http://business-accounting-guides.com/trialbalance/", "title": "Business Accounting Guides: The Adjusted Trial Balance in the Accounting Cycle", "url": "http://business-accounting-guides.com/trialbalance/" }, { "_id": "http://blog.accountingcoach.com/what-is-an-adjusted-trial-balance/", "external_url": "http://blog.accountingcoach.com/what-is-an-adjusted-trial-balance/", "title": "AccountingCoach: What Is an Adjusted Trial Balance?", "url": "http://blog.accountingcoach.com/what-is-an-adjusted-trial-balance/" } ], "related_content_rcp": [ { "_id": "bizfluent.com/info-8406138-type-prepaid-insurance-balance-sheet.html", "external_url": "bizfluent.com/info-8406138-type-prepaid-insurance-balance-sheet.html", "image_url": "#", "title": "What Type of Account Is Prepaid Insurance on the Balance Sheet?", "url": "bizfluent.com/info-8406138-type-prepaid-insurance-balance-sheet.html" }, { "_id": "bizfluent.com/info-7753130-matching-concept-vs-accrual-accounting.html", "external_url": "bizfluent.com/info-7753130-matching-concept-vs-accrual-accounting.html", "image_url": "https://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/60/243/fotolia_1677292_XS.jpg", "title": "Matching Concept Vs. 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"url": "bizfluent.com/about-6620332-provision-doubtful-debts-.html" }, { "_id": "bizfluent.com/info-8783138-financial-statements-affected-adjusting-entries.html", "external_url": "bizfluent.com/info-8783138-financial-statements-affected-adjusting-entries.html", "image_url": "http://photos.demandstudios.com/getty/article/117/81/76758332.jpg", "title": "What Financial Statements Are Affected by Adjusting Entries?", "url": "bizfluent.com/info-8783138-financial-statements-affected-adjusting-entries.html" }, { "_id": "bizfluent.com/how-7727278-calculate-cost-goods.html", "external_url": "bizfluent.com/how-7727278-calculate-cost-goods.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/cache.gettyimages.com/d3dcb57f94e449138cedc8bcfa698de2.jpg", "title": "How to Calculate the Cost of Goods", "url": "bizfluent.com/how-7727278-calculate-cost-goods.html" }, { "_id": "bizfluent.com/how-8330148-set-12-column-bookkeeping-system.html", "external_url": 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"caption": "Make an adjusted trial balance sheet for accurate books.", "credit": "Thinkstock/Comstock/Getty Images", "height": 2289, "licensetype": "RF", "photoguid": null, "photoid": "getty/92572372", "photosource": null, "summary": "Accounting document", "thumbheight": 0, "thumburl": "http://cache.gettyimages.com/xt/92572372.jpg?v=1&g=fs1|0|COM|72|372&s=1", "thumbwidth": 0, "title": "Accounting document", "url": "http://photos.demandstudios.com/getty/article/110/102/92572372.jpg", "width": 1527 } }, { "content": "Accounting for your small business involves matching debits to credits. You need to create a trail balance sheet followed by an adjusted trial balance sheet that shows these debits and credits. If you follow set procedures each month, you will have accurate adjusted trial balance sheets that you can use to monitor the progress of your business." } ] }, { "parts": [ { "content": "You must create a trial balance for the month. Do this by creating two columns. The column on the left should contain all of your debits for the month. The column on the right should contain all of your credits for the month. The two columns should have totals that match. The reason theymatch is that even if your income exceeds your expenses, you should show a debit that puts the excess income into an account." } ], "rich_title": "Trial Balance", "title": "Trial Balance" }, { "parts": [ { "content": "At the end of the month, or sometimes during the following month, you may find debits and credits you did not record on your trial balance. Add the missing entries and balance the sheet so that debits match credits. This adjusted trial balance sheet is your opportunity to correct not only missing information that was left out of the trial balance, but also a chance to actually balance debits and credits. Your trial balance sheet may have been out of balance, and your adjusted balance sheet can create balanced columns because of the new information contained in the adjusting entries." } ], "rich_title": "Adjusting Entries", "title": "Adjusting Entries" }, { "parts": [ { "content": "You may have errors, even if your debit and credit columns have matching totals. For example, you may have placed an asset in the wrong category, or you may have used the wrong account to record an expense. You should also check to see that no transactions were entered twice. Examine your trial balance sheet for these errors and make necessary corrections." } ], "rich_title": "Errors", "title": "Errors" }, { "parts": [ { "content": "You will find that your adjusting entries come from some predictable areas. For example, payroll taxes usually have to be entered late in the month or during the following month because final figures for these taxes are not available until the month\u2019s total wages have been figured. Your interest-payable figure may not be available until after your trial balance sheet is prepared. You can prepare your adjusted trial balance sheet after the lender notifies you of the interest you owed for the month. Insurance deductible may also affect your adjusted trial balance sheet. If you have made any insurance claims during the month, the insurance company may not notify you of the deductible you must pay until the following month." } ], "rich_title": "Typical Adjustments", "title": "Typical Adjustments" } ], "studio_article_id": "5865988", "studio_id": "d0a23982-ba67-49d6-9cd9-0ac653666017", "summary": "Accounting for your small business involves matching debits to credits. You need to create a trail balance sheet followed by an adjusted trial balance sheet that shows these debits and credits. 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"pub_date": "2012-01-15T13:31:06.594000", "readability": "12", "references": [ { "_id": "http://blog.accountingcoach.com/unearned-deferred-revenue/", "external_url": "http://blog.accountingcoach.com/unearned-deferred-revenue/", "title": "AccountingCoach: Would You Please Explain Unearned Income?", "url": "http://blog.accountingcoach.com/unearned-deferred-revenue/" }, { "_id": "https://www.accountingcoach.com/accounting-principles/explanation", "external_url": "https://www.accountingcoach.com/accounting-principles/explanation", "title": "AccountingCoach: Accounting Principles", "url": "https://www.accountingcoach.com/accounting-principles/explanation" }, { "_id": "http://simplestudies.com/what-is-unearned-deferred-revenue.html", "external_url": "http://simplestudies.com/what-is-unearned-deferred-revenue.html", "title": "Simplestudies: What Is Unearned (Deferred) Revenue?", "url": "http://simplestudies.com/what-is-unearned-deferred-revenue.html" } ], "related_content_rcp": [ { "_id": 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"https://cpi.studiod.com/www_ehow_com/photos.demandstudios.com/162/227/fotolia_3590135_XS.jpg", "title": "Hotel Accounting Procedures", "url": "bizfluent.com/list-6717460-hotel-accounting-procedures.html" }, { "_id": "bizfluent.com/how-5989038-record-bad-check-transaction-quickbooks.html", "external_url": "bizfluent.com/how-5989038-record-bad-check-transaction-quickbooks.html", "image_url": "#", "title": "How to Record a Bad Check Transaction in QuickBooks", "url": "bizfluent.com/how-5989038-record-bad-check-transaction-quickbooks.html" } ], "sections": [ { "parts": [ { "content": "An unearned fee in accounting is money a business collects from a customer up front for services the company has yet to perform, such as a prepaid annual membership. If your small business collects unearned fees, you must record the fees initially as a liability on the balance sheet. As you complete the services for those fees, the fees become earned revenue, which you record on the income statement." } ] }, { "parts": [ { "content": "Revenue increases your profit on the income statement. The revenue recognition principle under generally accepted accounting principles, or GAAP, requires a business to record revenue when it completes a service or sells a product, regardless of when payment occurs. This means a small business must record its unearned fees as revenue in portions as it earns the revenue, not when it receives the cash. For example, you would record an unearned fee for an annual membership as revenue in 12 equal portions at the end of each month." } ], "rich_title": "Revenue Recognition", "title": "Revenue Recognition" }, { "parts": [ { "content": "When your small business collects an unearned fee, report the amount initially as unearned revenue in the liabilities section of your balance sheet. Liabilities are amounts you owe another party. Also, increase your cash account in the assets section of your balance sheet. For example, if you collect $480 for an annual membership, report $480 as unearned revenue in the liabilities section of your balance sheet and increase the cash account by $480. This shows you collected $480 and owe your customer $480 in services." } ], "rich_title": "Reporting Unearned Fees", "title": "Reporting Unearned Fees" }, { "parts": [ { "content": "As each month passes and your small business completes a portion of the services for which your customer paid you, you must report that portion as revenue. If you complete the same amount of services each month, divide the unearned fees you collected by the number of months for which you owe the customer your services, to determine the monthly revenue. For example, if you collected $480 for a prepaid annual membership, divide $480 by 12 to get $40 per month in revenue." } ], "rich_title": "Calculation of Earned Revenue", "title": "Calculation of Earned Revenue" }, { "parts": [ { "content": "At the end of each month, increase your revenue account on your income statement by the portion of unearned fees that you have earned as revenue. Decrease your unearned revenue account by the same amount. The decrease in unearned revenue reduces the amount of services you still owe your customer. For example, if you earned $40 in revenue during a month as a portion of the unearned fees you collected, increase your revenue account by $40 and decrease your unearned revenue account by $40." } ], "rich_title": "Reporting Unearned Fees as Revenue", "title": "Reporting Unearned Fees as Revenue" } ], "studio_article_id": "5879360", "studio_id": "c01fd5e0-00f0-4b53-8bb4-955e83f568b7", "summary": "An unearned fee in accounting is money a business collects from a customer up front for services the company has yet to perform, such as a prepaid annual membership. If your small business collects unearned fees, you must record the fees initially as a liability on the balance sheet. As you complete the services for those fees, the fees become earned revenue, which you record on the income statement.", "tags": [], "title": "What Is an Unearned Fee in Accounting?", "title_id": 13326607, "type": "Article", "url": "/13326607/what-is-an-unearned-fee-in-accounting", "writer": "www.demandstudios.com/contributor/7b968201-ac0f-46bf-a15b-9c49a50a1c56" }, { "_full_id": "http://www.translatoruser-int.com/bizfluent.com/13326637/basic-accounting-principles-concepts-for-t-accounts", "_id": "bizfluent.com/13326637/basic-accounting-principles-concepts-for-t-accounts", "_last_updated": "2019-06-04T15:55:19.311000", "_type": "document", "_url": "http://bizfluent.com/13326637/basic-accounting-principles-concepts-for-t-accounts", "ancestor_categories": [ "bizfluent.com/accounting/", "bizfluent.com/finance-your-business/", "bizfluent.com/" ], "content_type": "Freestyle", "external_url": "bizfluent.com/13326637/basic-accounting-principles-concepts-for-t-accounts", "fixed_category": [ { 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"thumbnail_url": "http://photos.demandstudios.com/getty/article/178/73/AA000731.jpg", "thumburl": "http://cache.gettyimages.com/xt/AA000731.jpg?v=1&g=fs1|0|PDI|00|731&s=1", "thumbwidth": 0, "title": "Adding Machine", "url": "http://photos.demandstudios.com/getty/article/178/73/AA000731.jpg", "width": 1024 }, "keywords": [ "T-account debits", "T-account credits", "Understanding T-accounts" ], "last_updated": "2019-06-04T15:55:19.311000", "level": 2, "meta": { "embeds": 0, "images": 1, "sections": 4, "slides": 0, "steps": 0, "things_needed": 0, "tips": 0, "videos": 0, "warnings": 0, "word_count": 586 }, "og_title": "Basic Accounting Principles & Concepts for T-Accounts", "original_published_date": "2012-01-16T04:36:00", "owning_domain": "bizfluent.com", "page_title": "Basic Accounting Principles & Concepts for T-Accounts", "parent_category": "bizfluent.com/accounting/", "pub_date": "2012-01-15T21:30:58.577000", "readability": "12", "references": [ { "_id": "http://www.cliffsnotes.com/study_guide/T-Accounts.topicArticleId-21081,articleId-21009.html", "external_url": "http://www.cliffsnotes.com/study_guide/T-Accounts.topicArticleId-21081,articleId-21009.html", "title": "CliffsNotes: T Accounts", "url": "http://www.cliffsnotes.com/study_guide/T-Accounts.topicArticleId-21081,articleId-21009.html" }, { "_id": "http://blog.accountingcoach.com/t-account/", "external_url": "http://blog.accountingcoach.com/t-account/", "title": "Accounting Coach: What is a T-Account?", "url": "http://blog.accountingcoach.com/t-account/" }, { "_id": "http://faculty.uml.edu/ccarter/Chapter02Part2.htm", "external_url": "http://faculty.uml.edu/ccarter/Chapter02Part2.htm", "title": "University of Massachusetts Lowell: The T Account", "url": "http://faculty.uml.edu/ccarter/Chapter02Part2.htm" }, { "_id": "http://www.accountingformanagement.com/double_entry_bookkeeping.htm", "external_url": "http://www.accountingformanagement.com/double_entry_bookkeeping.htm", "title": "Accounting for Management: Double Entry System", "url": "http://www.accountingformanagement.com/double_entry_bookkeeping.htm" }, { "_id": "https://www.accountingcoach.com/debits-and-credits/explanation#debits-and-credits-deb", "external_url": "https://www.accountingcoach.com/debits-and-credits/explanation#debits-and-credits-deb", "title": "Accounting Coach: Debits and Credits", "url": "https://www.accountingcoach.com/debits-and-credits/explanation#debits-and-credits-deb" } ], "related_content_rcp": [ { "_id": "bizfluent.com/facts-5653107-credit-balance-.html", "external_url": "bizfluent.com/facts-5653107-credit-balance-.html", "image_url": "https://s3-us-west-1.amazonaws.com/contentlab.studiod/getty/a31169a1164c42c584c734dbde21c44b.jpg", "title": "What Is Credit Balance?", "url": "bizfluent.com/facts-5653107-credit-balance-.html" }, { "_id": "bizfluent.com/info-8538845-manufacturing-accounting-entries.html", "external_url": 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"sections": [ { "parts": [ { "image": { "alttext": "Adding Machine", "aspectratio": 1, "attributionhtml": "Duncan Smith/Photodisc/Getty Images", "attributionlink": "", "attributiontext": "Duncan Smith/Photodisc/Getty Images", "caption": "In some cases, an account may not carry a normal balance.", "credit": "Duncan Smith/Photodisc/Getty Images", "height": 1024, "licensetype": "RF", "photoguid": null, "photoid": "getty/AA000731", "photosource": null, "summary": "Adding Machine", "thumbheight": 0, "thumburl": "http://cache.gettyimages.com/xt/AA000731.jpg?v=1&g=fs1|0|PDI|00|731&s=1", "thumbwidth": 0, "title": "Adding Machine", "url": "http://photos.demandstudios.com/getty/article/178/73/AA000731.jpg", "width": 1024 } }, { "content": "A T-account is a visual structure shaped in the letter T that shows the transactions of an account represented in a company\u2019s general ledger. A T-account consists of a left side and right side, and the name of the account sits at the top of a T-account. The left side of a T-account represents a debit and the right side a credit. A T-account allows an accounting professional to manually calculate the balance of a specific account in a quick and efficient manner. Small business accounting personnel and business owners should understand how T-accounts work and their importance to maintaining accurate financial records." } ] }, { "parts": [ { "content": "You can use a T-account to determine the correct balance for a specific account or the amount needed to arrive at a certain balance. T-accounts also are useful when recording adjusting entries, which include accruals and deferrals made at the end of a period. Each type of account listed in a general ledger carries a normal balance of a debit or credit. After all transactions are entered into the appropriate T-accounts, the total amount of debits made to all of the T-accounts should equal the total amount of credits made to all of the T-accounts. If the total amount of debits and credits do not balance, you should recheck all of the transactions to verify that you entered the amounts correctly." } ], "rich_title": "Understanding a T-Account", "title": "Understanding a T-Account" }, { "parts": [ { "content": "A T-account uses double entry accounting by placing the transaction amount in the debit column of one T-account and in the credit column of a corresponding T-account. For example, if a company sells a product to a customer for $1,000 cash, the bookkeeper must make an entry in two separate T-accounts. A debit entry for $1,000 is added to the left side of the cash T-account, and a credit entry is added to the right side of the revenue T-account. Most small businesses implement double-entry accounting because of the advantages the system offers. Double-entry accounting allows you to prepare accurate financial statements because transactions are recorded to asset and liability accounts. Double-entry accounting also gives you the ability to draw a trial balance to verify that transactions are accurately recorded." } ], "rich_title": "Double-Entry Accounting", "title": "Double-Entry Accounting" }, { "parts": [ { "content": "A debit means that an accounting entry is entered on the left side of an account. Debits increase the value of accounts that carry normal debit balances. Accounts that increase due to a debit include dividends, expenses, assets and losses. For example, when a company sells a product on credit to a customer, a bookkeeper debits the accounts receivable account. The accounts receivable account is an asset, and the debit increases the total value of the account. A credit decreases the value of accounts that carry normal debit balances. Continuing with the example, when the customer pays his bill for the products purchased, the bookkeeper credits the accounts receivable account to reflect the payment received and decrease the value of the account." } ], "rich_title": "Debits", "title": "Debits" }, { "parts": [ { "content": "A credit represents an accounting entry entered on the right side of an account. Credits increase the balance of accounts that normally carry credit balances. Accounts with normal credit balances include gains, income, revenue, liabilities and stockholders\u2019 or owners\u2019 equity. A debit decreases the balance of these accounts. For example, when a company buys a product from a vendor on credit, a bookkeeper records a credit to the company\u2019s accounts payable account to reflect the liability. When the company pays its invoice for the product purchased on credit, the bookkeeper debits the accounts payable account to reflect that the company paid its liability." } ], "rich_title": "Credits", "title": "Credits" } ], "studio_article_id": "5878780", "studio_id": "21cbb481-7fb6-4805-855c-393a42e38b0b", "summary": "A T-account is a visual structure shaped in the letter T that shows the transactions of an account represented in a company’s general ledger. A T-account consists of a left side and right side, and the name of the account sits at the top of a T-account. The left side of a T-account represents a debit and the right side a credit. A T-account allows an accounting professional to manually calculate the balance of a specific account in a quick and efficient manner. 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Public Small Cap", "original_published_date": "2012-02-23T22:14:00", "owning_domain": "bizfluent.com", "page_title": "Small Cap Private Equity Vs. 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"photoguid": null, "photoid": "getty/80410231", "photosource": null, "summary": "Dollar sign with line graph", "thumbheight": 0, "thumburl": "http://cache.gettyimages.com/xt/80410231.jpg?v=1&g=fs1|0|COM|10|231&s=1", "thumbwidth": 0, "title": "Dollar sign with line graph", "url": "http://photos.demandstudios.com/getty/article/192/56/80410231.jpg", "width": 2121 } }, { "content": "Small cap private equity firms do not issue shares to the public whereas public small cap companies do. The definition of \"small cap\" varies from country to country; a small cap company in the United States might be equivalent to a medium cap in another country. Long-term speculators hunt for small caps that are poised for growth or possible buyouts from bigger companies, which can dramatically raise equity value. Benchmarks that define small cap public companies and small cap private equity firms fluctuate with economic changes." } ] }, { "parts": [ { "content": "Small cap private equity firms have funding between $10 million and $25 million. Equity firms are difficult to research because they are not required to report earnings to the public. Investments in private equity are made by financial institutions such as venture capitalists, which may own, fund and manage multiple businesses. Funding can also come from pension funds and universities. One of the attractions to this type of financial instrument is that it adds long-term diversity to a portfolio." } ], "rich_title": "Small Cap Private Equity", "title": "Small Cap Private Equity" }, { "parts": [ { "content": "Small cap public companies usually have a capitalization between $500 million and $1 billion. Small cap public company stocks that trade under the $5 per share benchmark are called \"penny stocks,\" although not all small caps are penny stocks and not all penny stocks can be categorized by small capitalization. Many penny stocks reflect financially struggling companies emerging from or headed for bankruptcy. Penny stocks do not face the same Securities and Exchange Commission reporting requirements as large cap stocks, making them difficult to research. Small cap companies can be pioneers of new industries as well as laggards or former leaders in established industries" } ], "rich_title": "Public Small Cap", "title": "Public Small Cap" }, { "parts": [ { "content": "Liquidity is difficult to manage in thinly traded small cap public companies because sellers of shares cannot always be matched with buyers. When a stock has zero volume it means there is no trading activity among investors and could mean that buyers and sellers cannot agree on share prices, which can lock a holder into a position indefinitely. Illiquidity is also a risk factor with private equity, whose valuations are often uncertain. Private equity investments usually involve long term fixed agreements by limited partners. 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To avoid misstatements to a company's financial statements, it is important that the account is reconciled each month." } ] }, { "parts": [ { "content": "Amounts that comprise the prepaid expense balance on a company's balance sheet at period-end include, but are not limited to, prepaid insurance premiums, prepaid rent, property taxes and prepaid service contracts. The payment is recorded as an asset at the time of payment and as the benefit is consumed, the balance continues to decline." } ], "rich_title": "Types of Prepaid Expenses", "title": "Types of Prepaid Expenses" }, { "parts": [ { "content": "The impact to the income statement and balance sheet when prepaid expenses fail to be properly adjusted can best be understood with an example. Assume that on Jan. 5 a company that designs and manufactures t-shirts purchases a 12-month maintenance agreement for two of the machines used in production. The agreement costs $9,600, begins on Feb. 1 and expires Jan. 31 of the following year." } ], "rich_title": "Example of Prepaid Expenses", "title": "Example of Prepaid Expenses" }, { "parts": [ { "content": "Since the purchase was made in January, the following entry will be made by the company's bookkeeper by Jan. 31: Debit prepaid expenses $9,600 Credit cash $9,600 Note that since the usage on the agreement has not occurred yet, this entry only impacts the balance sheet." } ], "rich_title": "Recording the Asset", "title": "Recording the Asset" }, { "parts": [ { "content": "Since the contract has a total cost of $9,600 for a 12-month service period, the company will expense $800 each month to the maintenance and repairs account. The recurring monthly entry recorded by the company's bookkeeper is as follows: Debit repairs and maintenance expenses $800 Credit prepaid expenses $800 With a credit to the asset account of prepaid expenses, this entry will continue to consume the asset over the agreement period until the balance is zero at the end of the contract period." } ], "rich_title": "Recurring Entry", "title": "Recurring Entry" }, { "parts": [ { "content": "On May 21, the company's bookkeeper realizes that he has failed to book the monthly entry to prepaid expenses since the time the contract began. This means that each month, the company's expenses have been understated by $800 resulting in overstated income of the same amount. It also means that the prepaid expense asset account on the company's balance sheet has been overstated for three months by a total of $2,400." } ], "rich_title": "Failing to Record the Entry", "title": "Failing to Record the Entry" }, { "parts": [ { "content": "To correct her error and \"catch up\" for February through May, the bookkeeper makes the following entry at month-end: Debit repairs and maintenance expenses $3,200 Credit prepaid expenses $3,200 The bookkeeper then explains to the owner that while repairs and maintenance for the month of May appears to be very high, it is the result of booking four months at once and from failing to expense the amount for the last four periods." } ], "rich_title": "Making the Correction", "title": "Making the Correction" } ], "studio_article_id": "6721391", "studio_id": "b01cdbae-be28-4bbc-b744-e8c8fb4c6de2", "summary": "Prepaid expenses are classified as an asset on a company's balance sheet since their balance represents a benefit that will be used in future periods. 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"authorizations": [ "Download", "HighResComp" ], "caption": "Produce more if marginal revenue is greater than marginal cost", "collectionname": "Comstock", "credit": "Jupiterimages/Comstock/Getty Images", "external_url": "http://photos.demandstudios.com/getty/article/163/177/86500061.jpg", "height": 2290, "isfavorite": false, "licensetype": "RF", "noimagetext": "", "photoguid": null, "photoid": "getty/86500061", "photosource": null, "summary": "Cardboard boxes on assembly line", "thumbheight": 0, "thumbnail_url": "http://photos.demandstudios.com/getty/article/163/177/86500061.jpg", "thumburl": "http://cache.gettyimages.com/xt/86500061.jpg?v=1&g=fs1|0|COM|00|061&s=1", "thumbwidth": 0, "title": "Cardboard boxes on assembly line", "url": "http://photos.demandstudios.com/getty/article/163/177/86500061.jpg", "width": 1526 }, "keywords": [ "Marginal Analysis", "Profit Maximization", "Decision Making" ], "last_updated": "2019-06-04T15:55:19.986000", "level": 2, "meta": { "embeds": 0, 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"thumbwidth": 0, "title": "Cardboard boxes on assembly line", "url": "http://photos.demandstudios.com/getty/article/163/177/86500061.jpg", "width": 1526 } }, { "content": "All people make decisions \u201cat the margin,\u201d and business owners are no exception. Decisions to sell one more unit, produce one more run or make one more photo shoot are all decisions that are made at the margin. The decision process weighs the pros (marginal benefits) and the cons (marginal cost). When these two things are equal, it means you are maximizing profit." } ] }, { "parts": [ { "content": "Marginal revenue is the additional revenue that a business earns when it sells one more unit. Many firms can sell as much as they can produce without having to change the price. Economists tell us that those firms are in perfect competition and that the demand for their products is perfectly elastic. For other firms, increasing production means cutting the price to move the products. In either case the marginal revenue will be the price of the last unit sold." } ], "rich_title": "Marginal Revenue", "title": "Marginal Revenue" }, { "parts": [ { "content": "The marginal cost is the amount it takes to produce one more unit, which includes labor and material cost and the costs associated with that unit\u2019s production. These are metrics that can be estimated with reasonable accuracy. Labor time and cost are measurable, as are material costs. Overhead does not factor into the figure, since it is fixed and is independent of the unit production." } ], "rich_title": "Marginal Cost", "title": "Marginal Cost" }, { "parts": [ { "content": "Marginal analysis involves looking at the effect of producing that additional unit of output. At low levels of production it is likely that marginal revenue is greater than marginal cost. By producing more, a business adds to its profits, because each successive unit adds more to the revenue than it does to its cost. Eventually, however, marginal cost will begin to rise as production costs go up. When marginal cost rises to equal marginal revenue, the firm will be maximizing its profit. In the unlikely event that a business reaches a production level where its marginal cost is greater than marginal revenue, it should cut production back to the point where the two metrics were equal." } ], "rich_title": "Equating the Two", "title": "Equating the Two" }, { "parts": [ { "content": "Consider a full-service restaurant. If the average meal price is $15, that figure is the marginal revenue. As long as it costs less than $15 to prepare that meal, the restaurant will continue to sell as many as it can. But if the cost to prepare and serve the meal costs more than $15, the restaurant has three choices: cut back on its menu, raise the price of the meal (raising the marginal revenue) or send several of the workers home for the day (to lower the marginal cost). A retail shop that sells shoes for $50 a pair has a marginal revenue of $50. As long as the cost of selling each pair is less than that, the store will sell all it can, since each sale adds more profit. But if the marginal cost of a pair rises above $50 -- possibly because brisk sales led to hiring too many salespeople -- then the owner should downsize to restore profitability." } ], "rich_title": "Business Applications", "title": "Business Applications" } ], "studio_article_id": "6945484", "studio_id": "d6fef834-3d58-4606-bcec-59ae37746be0", "summary": "All people make decisions “at the margin,” and business owners are no exception. Decisions to sell one more unit, produce one more run or make one more photo shoot are all decisions that are made at the margin. The decision process weighs the pros (marginal benefits) and the cons (marginal cost). 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records can help you identify errors and potential problems.", "collectionname": "Creatas", "credit": "Creatas/Creatas/Getty Images", "height": 1419, "isfavorite": false, "licensetype": "RF", "photoguid": null, "photoid": "getty/76696815", "photosource": null, "summary": "Two businesswomen at desk going over papers", "thumbheight": 0, "thumburl": "http://cache.gettyimages.com/xt/76696815.jpg?v=1&g=fs1|0|CRE|96|815&s=1", "thumbwidth": 0, "title": "Two businesswomen at desk going over papers", "url": "http://photos.demandstudios.com/getty/article/88/211/76696815.jpg", "width": 2114 } }, { "content": "The audit process is important for ensuring that accounting staff is following the appropriate procedures. When you conduct an internal audit, it gives you the opportunity to review samplings of all of the company transactions to identify errors or questionable accounting practices. If you uncover any cause for concern, you may want to consider hiring an external audit firm to help you get to the bottom of it." } ] }, { "parts": [ { "content": "Determine what period of accounting records you plan to audit. You may want to conduct a sampling audit of the last fiscal year or the last quarter. Alternatively, you may feel that you need to do a thorough audit of the last month's transactions. If you're auditing a period with large transactions, you may want to do a sampling audit instead of auditing the complete transaction history." } ], "rich_title": "Audit Period", "title": "Audit Period" }, { "parts": [ { "content": "Pull a report that details all of the sales transactions recorded during the audit period. If you're conducting a complete audit, pull the documentation for all of the transactions so you can compare the sales records against the financial ledger. Choose a representative sampling of the transactions that posted in the period if you're conducting a sample audit. Consider the total number of transactions when you choose your samples so you can review a reasonable amount between 5 and 10 percent. Compare the transactions recorded in the ledger against the sales invoices. Match up the amounts among the ledger, the invoice, and the customer's check to ensure accuracy." } ], "rich_title": "Sales Records", "title": "Sales Records" }, { "parts": [ { "content": "Review a report of all of the business expenses for the audit period. If you're conducting a complete audit, pull the invoices, payment records and other documentation to support all of the transactions. Otherwise, select a representative sample, as you did with the sales records. Compare the ledger reporting with the invoices paid and the actual amounts reflected in the bank activity." } ], "rich_title": "Expenses", "title": "Expenses" }, { "parts": [ { "content": "Review the bank statements for the audit period. Bank statements can help you identify whether or not money is unaccounted for from the bank account. Compare every transaction in the statement against the transactions recorded in the ledger. Determine that there is a transaction in the ledger to match each bank account transaction. Match each of these to an invoice, a payable statement or other documentation to ensure that it is valid." } ], "rich_title": "Bank Reconciliations", "title": "Bank Reconciliations" }, { "parts": [ { "content": "Review your payroll records and compare the salary statements against your active employee roster. Verify that hourly rates and salary amounts are accurate in the payroll system. 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"bizfluent.com/how-6456866-calculate-closing-inventory.html" }, { "_id": "bizfluent.com/about-6670130-job-description-warehouse-inventory-clerks.html", "external_url": "bizfluent.com/about-6670130-job-description-warehouse-inventory-clerks.html", "image_url": "http://photos.demandstudios.com/181/203/fotolia_908233_XS.jpg", "title": "Job Description of Warehouse Inventory Clerks", "url": "bizfluent.com/about-6670130-job-description-warehouse-inventory-clerks.html" } ], "resources": null, "review_date": "2019-09-20T17:53:46.984000", "review_history": [ { "expert_reviewer": "www.demandstudios.com/contributor/c6dbe535-7ea1-4764-807f-9a1de22b8b90", "review_date": "2019-08-09T09:30:04.869000" } ], "reviewer": "Jayne Thompson, LL.B., LL.M.", "search_term": null, "sections": [ { "parts": [ { "image": { "_id": "bizfluent.com/how-6472551-calculate-inventory-shrinkage.html", "alttext": "...", "aspectratio": 0.75, "attributionhtml": "military boxes image by Ivonne Wierink from Fotolia.com", "caption": "Shrinkage measures inventory losses.", "credit": "military boxes image by Ivonne Wierink from Fotolia.com", "getty_id": null, "guid": "7c8638be-9ed8-6981-c1c7-44631d89c5b0", "height": 400, "photoid": "Imported/1509132437.39/c19c4c24-90d7-4850-86d8-4a2460f80906", "thumbheight": "110", "thumbnail_url": "http://photos.demandstudios.com/60/133/fotolia_2393890_XS.jpg", "thumburl": "http://photos.demandstudios.com/0/220/fotolia_2393890_thumb.jpg", "thumbwidth": "83", "unique_id": "93DDj", "url": "http://photos.demandstudios.com/60/133/fotolia_2393890_XS.jpg", "width": 300, "x": "1" }, "thumbnail": "http://photos.demandstudios.com/60/133/fotolia_2393890_XS.jpg" }, { "content": "Inventory doesn't always match what's written in your ledger. Your accounts may show that you have $400,000 worth of goods in the warehouse, but when you count it, it's $398,000 or even $370,000. The accounting term for this situation is _inventory shrinkage_. You'll have to calculate inventory shrinkage and account for it to keep your ledgers accurate." }, { "tip": "To calculate inventory shrinkage, take a physical count of inventory and subtract the value from the written value in your account books. Divide the result by the inventory value in your ledgers to get the shrinkage percentage." } ] }, { "parts": [ { "content": "Inventory shrinkage sounds like the result of theft, and sometimes, it is. It can also result from errors and plain bad luck." }, { "content": "* Somebody dropped and broke a couple of jars but didn't record the loss.

\n* One of your employees entered a wrong number somewhere in the system. Putting down the wrong price or reversing 19 to 91 will throw off your inventory. Omitting a decimal point here and there can do the same.

\n* Shoplifting from your store.

\n* Employee theft.

\n* Supplier fraud \u2014 this includes truckers removing a few items from the shipment for their own use and suppliers who don't ship as much as the invoice says.

\n* Some items have been placed somewhere they shouldn't be put, and now they can't be found.

\n* Unknown causes \u2014 about 6% of shrinkage has no explanation.
" }, { "content": "Individual causes of inventory shrinkage may be small and insignificant, but they accumulate over time. One $4 lipstick isn't significant shrinkage, but 100 over a quarter adds up to $400." } ], "rich_title": "Why Does Inventory Shrink?", "title": "Why Does Inventory Shrink?" }, { "parts": [ { "content": "Inventory shrinkage is one of the simpler accounting formulas. The toughest part is that you'll need a **physical count of the inventory** first. You and your staff can make the count, or you can hire an inventory firm to manually count the stock." }, { "content": "Suppose you own an electronics store with a merchandise book value of $245,000. You conduct a physical inventory and find the value to be $237,000. Your total sales between inventories totaled $360,000. Calculating inventory shrinkage is simpler than the physical count." }, { "content": "Subtract the value of the inventory from what's in the books, which in this example gives you a result of $8,000. Divide $8,000 by the book value of $245,000 to get .032, which equals a 3.2% inventory shrinkage rate. Sales don't affect the shrinkage calculation." } ], "rich_title": "Calculating Inventory Shrinkage", "title": "Calculating Inventory Shrinkage" }, { "parts": [ { "content": "Once you have a shrinkage figure, you need to **adjust your accounts** to reflect it. In the given example, you'd subtract $8,000 from the $245,000 in your inventory account, producing the correct figure of $237,000. Then, you record $8,000 in a shrinkage expense account." } ], "rich_title": "Inventory Shrinkage Accounting", "title": "Inventory Shrinkage\u00a0Accounting" }, { "parts": [ { "content": "Shrinkage adds up to billions of dollars in losses for American business, mostly due to shoplifting and employee theft. There is no firm rule for what constitutes an acceptable shrinkage percentage for a given business, but you want the percentage at your stores to be as low as you can make it. If you see inventory shrinkage climbing steadily, that's a danger sign." }, { "content": "The average shrinkage percentage for all American retail is **1.44%**." } ], "rich_title": "Acceptable Shrinkage Percentage", "title": "Acceptable Shrinkage Percentage" }, { "parts": [ { "content": "If your inventory shrinkage levels are too high, you can attempt to reduce it. There are a variety of steps that can reduce shrinkage depending on what you find to be the cause:" }, { "content": "* Restrict employee access to your warehouse or storage area to those workers who are supposed to be there.

\n* Assign one of your employees personal responsibility for inventory accuracy.

\n* Make a count of all the items when they arrive at the receiving dock.

\n* Use a double-check system so that a second person has to verify records and account for shipments.

\n* Automate your inventory system to reduce human error.

\n* Train your staff in watching for shoplifters.
" } ], "rich_title": "Shrinking Inventory Shrinkage", "title": "Shrinking Inventory Shrinkage" } ], "skill_level": "Moderately Easy", "studio_article_id": "1895773", "studio_id": "0dee627d-a84b-4477-ae2c-3d2cec1fca28", "summary": "Inventory shrinkage happens for lots of reasons, from theft to accidental damage. To calculate shrinkage, first take a physical inventory count and subtract the total from the figure in your accounts. 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