Accounting Manager

Some asset accounts have a credit balance due to following reasons,

☛ Receiving and posting an amount that was higher than the recorded receivable

☛ Expenses occurred faster than the agreed upon prepayments

☛ An error caused by posting an amount to a wrong account

☛ The amount of checks written exceeded the positive amount in the Cash account

☛ Continuing to amortize or depreciate an asset after its balance has reached zero

Things that fall under intangible asset are,

☛ Patents

☛ Copyrights

☛ Trademarks

☛ Brand names

☛ Domain names, and so on.

To adjust entries into account, you can sort entries into five categories.

☛ Accrued expenses: Expenses have been incurred but the vendors invoices are not generated or processed yet

☛ Accrued revenues: Revenues have been earned but the sales invoices are not generated or processed yet

☛ Deferred revenues: Money was received in advance of having been paid or earned

☛ Deferred expenses: Money was paid for a future expense

☛ Depreciation expense: An asset purchased in one period must be allocated to expense in each of the accounting periods of the asset’s useful life

A certified financial accountant should have knowledge about

☛ Accounting principles and practices

☛ Reporting and analysis of financial data

☛ Auditing practices and principles

☛ Account management

☛ Budgets

☛ Software knowledge dealing with Accounting

☛ Knowledge of relevant laws, codes and regulations

There are three types of ledger

General ledger

Debtors ledger

Creditors ledger

When service or goods have been delivered, then revenues are reported in the accounting period.

Double entry accounting is an accounting system that requires recording business transaction or event in at least two accounts. It is the same concept of accounting, where every debit account should be matched with a credit account.

For example, if a company takes a loan from a bank, it receives cash as an asset but at the same time it creates a liability on a company. This single entry will affect both accounts, the asset accounts, and the liabilities accounts, such entry is referred as double entry accounting.

Long-term notes payable or liabilities are referred for that loan that are not supposed to due for more than a year. These are the loans from banks or financial institution that are secured against various assets on the balance sheet, such as inventories.

Provisions are the liabilities or the anticipated items such as depreciation. You can say provisions are expenses. Reserves are the profits of any company and a part of that profit is placed back to the business to keep it sustainable in tough times of a company.

The account “Cash” will be credited when a company pays a bill.

It is the term introduced in the records for every defective or unsatisfactory good returned back to its supplier.

The investment of personal assets by the owner will increase total assets and increase owner’s equity.

Account which is responsible or affected by the interest payable is “Current liability account”

A Bad debt expense is the amount of an account receivable that is considered to NOT be collectible.

Offset accounting is one that decreases the net amount of another account to create a net balance.

Entries to revenues accounts such as Service Revenues usually goes into credit side.

It is the time required by the company to pay all its account payables.

Assets minus liabilities is equal to owners’ equity or stockholders equity.

It is a kind of groups made on the basis of same responses by a system.

Suppose you have to produce an additional unit of output. The estimated cost of additional inputs to produce that output is actually the marginal cost.