Reading an Annual Report

Publicly traded companies are required by law to publish an annual report to their shareholders. Many companies publish quarterly reports as well. Though there is no government mandated format that an annual report should take or the exact information it should contain, custom has developed some standards, and some professional accounting organizations have required compliance … Continue reading Reading an Annual Report

Categories Accounting, Business, Investing and Financial Planning1 Comment

Financial Audits – Basic Tests

Financial audits are intended to provide some assurance to the public that a company’s financial statements are presented fairly and accurately, in accordance with the established or stated criteria.  The public may include the shareholders of the company, debtors such as bondholders, banks or other financial institutions and some government entities. In general, a financial … Continue reading Financial Audits – Basic Tests

Categories AccountingTags , Leave a comment

Calculating Depreciation — Straight-Line and Accelerated

Assets that a company owns, which are expected to last more than one year, are called Fixed Assets. These assets include such things as automobiles, computers, furniture, office buildings, and equipment. These fixed assets that a company owns have a set amount of useful life. This means that a fixed asset is not expected to … Continue reading Calculating Depreciation — Straight-Line and Accelerated

Categories AccountingLeave a comment

Accounting Trial Balance Example and Financial Statement Preparation

The last two steps in the accounting process are preparing a trial balance and then preparing the balance sheet and income statement. This information is provided in order to communicate the financial position of the entity to interested parties. TRIAL BALANCE A trial balance is a list and total of all the debit and credit … Continue reading Accounting Trial Balance Example and Financial Statement Preparation

Categories AccountingTags , , 9 Comments

Accounting Relationship: Linking the Income Statement and Balance Sheet

When communicating financial information to readers of the information, standard formats for financial statements have been established. The two most widely used statements are the Balance Sheet and Income Statement. Here we will learn how the Income Statement and Balance Sheet relate. THE INCOME STATEMENT AND BALANCE SHEET Income Statement The income statement communicates the … Continue reading Accounting Relationship: Linking the Income Statement and Balance Sheet

Categories Accounting2 Comments

Bank Accounts and Accounting: A General Overview

Nobody is thrilled when they get their monthly bank statement. Whether the balance shown is negative, less than expected, or the account just needs to be reconciled, it’s a time almost everyone would like to avoid. Why? I think the greatest contributor to this attitude: we simply do not know enough about banking, reconciling, and account management to look … Continue reading Bank Accounts and Accounting: A General Overview

Categories Accounting, BankingLeave a comment