Accounting

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About.com explains that a capital contribution in accounting is a segment of a company's recorded equity. The amount may be contributed using cash, equipment or other fixed assets. A common way for an owner to contribute capital to a company is to buy stocks.

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  • What is a trade discount?

    Q: What is a trade discount?

    A: According to the Accounting Tools website, trade discounts are provided to retailers by wholesalers for goods. The retailer can then charge the full manufacturer suggested retail price for the goods, using the discounted amount as profit.
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  • What is owner's capital?

    Q: What is owner's capital?

    A: In business, owner's capital, or owner's equity, refers to money that owners have invested into the business. In some instances, individuals prefer to finance activities through capital, rather than loans, to avoid facing any financial interest charges.When activities are financed through capital in a business, the profits must be paid to the owners.
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  • How do you define accounting ethics?

    Q: How do you define accounting ethics?

    A: Accounting ethics refers to the standards of right and wrong conduct that apply to the accounting profession. Various accounting organizations maintain professional codes of conduct to assist accountants with upholding ethical behavior.
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  • What are examples of liquid assets?

    Q: What are examples of liquid assets?

    A: Some examples of liquid assets include cash held in a safe deposit box, checking accounts, saving accounts, money market accounts, U.S. Treasury bills and some types of retirement accounts. An asset is liquid if you can quickly turn it into spendable cash without a significant penalty or loss in the underlying value.
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  • What is an imprest account?

    Q: What is an imprest account?

    A: An imprest account is one that holds a fixed amount of money and is replenished after a certain period of time. A good example of an imprest account is a petty cash system that may be replenished on a daily, weekly or monthly basis.
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  • What is the full disclosure principle in accounting?

    Q: What is the full disclosure principle in accounting?

    A: The full disclosure principle states that financial records should include all of the information necessary for readers to understand those records. This is a largely subjective principle, but full disclosure doesn't mean that records should include irrelevant information.
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  • What are sundry expenses?

    Q: What are sundry expenses?

    A: Sundry expenses are costs which may be relatively small or occur infrequently and are therefore not assigned to a specific ledger group. They are also known as miscellaneous expenses and are classified together as a group when they are presented in an accounting statement.
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  • What is an accounts payable aging report?

    Q: What is an accounts payable aging report?

    A: An accounts payable aging report is an accounting detail that lists the due dates of payments that a company owes to vendors. It helps a company plan how it will use available cash by revealing which invoices have been outstanding for the longest time.
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  • What is the prime cost formula?

    Q: What is the prime cost formula?

    A: The formula for prime cost is the sum of the direct cost of materials, the direct cost of labor and the direct cost of expenses, according to BusinessDictionary.com. The prime cost is the cost of a particular product that the manufacturer incurs apart from any business overhead expenses.
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  • What is the ordinary annuity formula?

    Q: What is the ordinary annuity formula?

    A: The ordinary annuity formula appears as "P = r (PV) / 1 - (1+R) - n." The formula is used to calculate the periodic payment against an annuity when the rate and payments remain the same, with the first payment exactly one period away.
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  • What are some advantages and disadvantages of trade credit?

    Q: What are some advantages and disadvantages of trade credit?

    A: The greatest advantages of trade credit to businesses include the availability of zero percent financing and potential discounts on needed goods, while the biggest disadvantage is the risk of late payment fees. Trade credit is an arrangement between a supplier and a business to receive goods or services while delaying cash payment until a later date.
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  • What is the advantage of an accounting information system?

    Q: What is the advantage of an accounting information system?

    A: The main advantages of an accounting information system are the increased speed of processing the numbers, efficient organization, and classification and safety of inputted data. This contrasts the manual evaluation of information, which involves writing out the data by hand and doing time consuming calculations.
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  • What is the difference between accounting and bookkeeping?

    Q: What is the difference between accounting and bookkeeping?

    A: Bookkeeping involves recording basic accounting transactions such as recording invoices from suppliers, paying suppliers, processing payroll and recording cash received from customers. Bookkeeping is a subset of accounting. Accounting is usually more involved and includes activities such as creating financial statements, creating budgets and compiling tax returns.
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  • What does retro pay mean?

    Q: What does retro pay mean?

    A: Retro pay are wages due to an employee for work already performed or services already rendered, usually in association with a pay raise that requires some sort of payroll action before taking effect.
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  • What is the definition of "revenue allocation"?

    Q: What is the definition of "revenue allocation"?

    A: Revenue allocation is the distribution or division of total income, or revenue, in a business, corporate or government structure. It involves a complex process that entails how and where to allocate revenues in order to ensure the viability of departments and maintain the operating structure of the organization.
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  • How do I complete a petty cash book?

    Q: How do I complete a petty cash book?

    A: To complete a petty cash book, keep a running tally of cash in the account, deposits, withdrawals and dates. The petty cash book is a summary of trivial expenses. It can take the form of a ledger sheet or a spreadsheet, such as a Microsoft Excel file. Typically a business maintains a petty cash account for minor expenses, such as meals, flowers, stamps and office supplies, according to Accounting Tools.
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  • What is strategic management accounting?

    Q: What is strategic management accounting?

    A: According to a Houston Chronicle article by Grant Houston, strategic management accounting is a form of business inquiry that combines the accounting criteria of an organization with external factors that influence the organization, such as industry trends in costing, pricing, market share and resources. The goal of strategic management accounting is to provide companies with a comprehensive means to analyze future business decisions. It is more complex than management accounting.
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  • What is income from continuing operations?

    Q: What is income from continuing operations?

    A: Income from continuing operations is ongoing earnings from normal business activity. It is what a company can expect from future earnings, such as if a company plans to continue to produce shoelaces and buttons but no longer zippers, earnings from the zippers is not calculated as income from continuing operations.
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  • How do you write a monthly report?

    Q: How do you write a monthly report?

    A: Monthly reports are used by project managers and program directors to inform supervisors of the progress of projects. The reports are based on one calendar month and are usually turned in within a week after the month ends. A report typically consists of one or two pages of easily digestible information.
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  • What is a goods received note?

    Q: What is a goods received note?

    A: A goods received note is a receipt given to the supplier to confirm delivery or acceptance of goods by the customer. After the supplier receives this note, a payment invoice is sent to the customer.
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  • What is the meaning of gross pay?

    Q: What is the meaning of gross pay?

    A: An employee’s gross pay is the money earned from working before taxes and other deductions. An employee’s gross pay includes the money they earn from commissions, overtime and tips.
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