The bonds were issued at a premium because the stated interest rate exceeded the prevailing market rate. A hypothetical 10% market interest rate and 10% of interest payments are issued as coupons biyearly. This is sold at par since market value interest is how to calculate premium on bonds payable identical to interest payments through [...]
To maintain the balance sheet equation, which states that the assets must equal liabilities plus equity, every transaction must be recorded with proper debits and credits. This ensures that the equation remains balanced and that the financial statements accurately represent the financial position and performance of a business. In article business transaction, we have explained [...]
Consider the 2017 massive data breach at Equifax that compromised data of over 143 million people. With proper internal controls functioning as intended, there would have been protective measures to ensure that no unauthorized parties had access to the data. Not only would internal controls prevent outside access to the data, but proper internal controls [...]
When new entities are added to a partnership or when previous partners leave, the methods will be used to evaluate each individual’s contributions to and stake in the company. The basics of accounting for a partnership business are similar to accounting for a sole proprietor. However, there are some key differences that are worth knowing [...]
Michelle Lesutis, Teaff’s eldest grandchild, and her sister, Amy Sleeman, both remember being shocked upon hearing about their grandfather’s being accounted for, believing the calls to be a fraud. But when officials were able to recall so much historical information, reality began to set in for the sisters, who both reside in the Pittsburgh area. [...]
The going concern concept assumes that the business will continue to operate indefinitely, without an owner or with a new one. The articles and research support materials available on this site are educational and are not intended to be investment or tax advice. All such information is provided solely for convenience purposes only and all [...]
In the U.S., licensed CPAs must have earned their designation from the American Institute of Certified Public Accountants (AICPA). Accounting information exposes your company’s financial performance; it tells whether you’re making a profit or just running into losses at the end of the day. Because of the simplified manner of accounting, the cash method is [...]
This document lists every transaction that took place between both businesses, including invoices and all payments made. This is important because the resulting client payments increase a vendor’s cash flow and allow the business owner to spend the money on the resources they need to keep the business going. Incorporating invoicing software into your business [...]
