A record of the increases and decreases in a specific asset, liability, equity, revenue, or expense is a(n): <br/> A、Journal.<br/> B、Posting.<br/> C、Trial balance.<br/> D、Account.<br/> E、Chart of accounts.
To understand why AR is an asset, we must define what assets in accounting are—alongside what liabilities are. Here are the high-level definitions of an asset vs. liability: Asset—An asset is anything that offers a company economic rewards. Liability—In contrast, a liability costs money ...
This means that a company’s accounts receivable may not always translate to revenue and profits, as some accounts may go unpaid. Then the question is whether accounts receivable is an asset or liability. We’ll discuss this in detail in the next section, so keep reading to learn more. ...
These differences also appear on the balance sheet as a current asset (prepaid interest) or a current liability (interest payable).ExampleIt’s a common practice for organizations to borrow funds to finance operations. Let’s assume a small grocery store chain requires a loan to expand the ...
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Revenues, which are the amounts earned through the sale of goods and/or the providing of services Expenses, which include the cost of goods sold, SG&A expenses, and interest expense Gains and losses, such as the sale of a noncurrent asset for an amount that is different from its book val...
Theinterestportion is the amount of the payment that gets applied as interest expense. This is often calculated as the outstanding loan balance multiplied by the interest rate attributable to this period's portion of the rate. For example, if a payment is owed monthly, this interest rate may ...
Deferred revenue is recorded as a liability on the balance sheet, and the balance sheet's cash (asset) account is increased by the amount received. Once the income is earned, the liability account is reduced, and the income statement's revenue account is increased. ...
“The central concept of a zero-based budget is that you assign a dollar amount for each expense in a given month.” Nermeen Ghneim, financial analyst How does a zero-based budget work if you, like Patrick, are trying to get more in control of your finances? Here’s everything you nee...
Define: a. Assets. b. Liabilities. c. Equity. What is the significance of Accumulated Depreciation as an asset account? Explain what Rent expense means. What do you mean by current liability? Define return on assets and explain what it measures. ...