Income tax payable is calculated usinggenerally accepted accounting principles (GAAP), using the current tax rates in the jurisdictions where the organization is subject to tax. Businesses operating in the United States are subject to federal, state, and local tax laws. They must also follow the ...
What is a direct expense in accounting? Accounting: Accounting is the recording of information regarding activities in a business that directly or indirectly relates to finances. The accounting records are later used to prepare financial statements of an accounting duration. ...
A company’s tax provision has two parts:current income tax expenseanddeferred income tax expense. To make things more complicated, most accounting departments useGenerally Accepted Accounting Principles (GAAP)to calculate their financial position. GAAP procedures differ in important ways from income tax...
What is an income and expense statement? What role does it serve in personal financial planning?Personal Finance:Personal finance covers money management which includes savings and investment accounts. Personal finance involves retirement planning, investments, insurance, tax ...
In Accounting, What Is the Difference Between a Liability Account and an Expense Account?. Accounting gives a business a way to keep track of its liabilities and expenses. A liability refers to a financial obligation, or upcoming duty to pay. An expense
Revenue is the amount earned from a company’s main operating activities, such as a retailer selling merchandise or a law firm providing legal services. Definition of Gain In accounting, a gain is the result of a peripheral activity, such as a retailer selling one of its old delivery trucks...
The income statement is an overview of how a business is performing over a particular accounting period such as month, quarter or year. Learn more.
An acquisition cost can be paid for well after something has been acquired. The timing of an expense can be misleading, so be cautious when analyzing total acquisition costs. Importance of Acquisition Costs Tracking acquisition costs is important for a few reasons. First, it facilitates financial ...
What is the statement of comprehensive income? What is a multiple-step income statement? What is net income? Is income tax an expense or liability? What is the profit and loss statement? Related In-Depth Explanations Accounting Basics Accounting Principles Financial Accounting Income Sta...
The amount that you can deduct is capped at your net taxable investment income for the year. Any leftover interest expense gets carried forward to the next year and can potentially be used to reduce your taxes in the future. To determine your deductible investment interest expense, you need ...