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The first and most important part of an income statement is the line reporting sales revenue. Businesses need to be consistent from year to year regarding when they record sales. For some business, the timing of recording sales revenue is a major problem, especially when the final acceptance by the customer depends on performance [...]

Some business owners choose to create partnerships or limited liability companies instead of a corporation. A partnership can also be called a firm, and refers to an association of a group of individuals working together in a business or professional practice.
While corporations have rigid rules about how they are structured, partnerships and limited liability companies [...]

Anyone who’s worked in an office at some point or another has had to go to accounting. They’re the people who pay and send out the bills that keep the business running. They do a lot more than that, though. Sometimes referred to as “bean counters” they also keep their eye on profits, costs and [...]

It might seem obvious, but in managing a business, it’s important to understand how the business makes a profit. A company needs a good business model and a good profit model. A business sells products or services and earns a certain amount of margin on each unit sold. The number of units sold is [...]

Forensic accounting is the practice of utilizing accounting, auditing, and investigative skills to assist in legal matters. It encompasses 2 main areas – litigation support, investigation, and dispute resolution. Litigation support represents the factual presentation of economic issues related to existing or pending litigation.
In this capacity, the forensic accounting professional quantifies damages sustained [...]

Another portion of the statement of cash flows reports the investment that the company took during the reporting year. New investments are signs of growing or upgrading the production and distribution facilities and capacity of the business.
Disposing of long-term assets or divesting itself of a major part of its business can be good or bad [...]

Depreciation is a term we hear about frequently, but don’t really understand. It’s an essential component of accounting however. Depreciation is an expense that’s recorded at the same time and in the same period as other accounts. Long-term operating assets that are not held for sale in the course of business are called fixed assets.
Fixed [...]

Accounting has become more and more complex as have the businesses that use accounting functions. Fortunately, there are several excellent software packages that can help you manage this important function. Quasar is one such package.
All versions of Quasar offer comprehensive inventory controls. In its most basic use, the inventory module allows a business owner to [...]

The FASB is one organization that provides standardized guidelines for financial reporting. The mission of the Financial Accounting Standards Board (FASB) is to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors and users of financial information.

Indpendent CPA auditors are like referees in the financial reporting arena. The CPA comes in, does an audit of the business’s accounting system and methods and gives a report that is attached to the company’s financial statements.
Publicly owned businesses are required to have their annual financial reports audited by independent CPA firms and any privately [...]