The estimated percentages are then multiplied by the total amount of receivables in that date range and added together to determine the amount of bad debt expense. The table below shows how a company would use the accounts receivable aging method. Read more
Better credit risk management also presents an opportunity to greatly improve overall performance and secure a competitive advantage. Risk-based pricing – Lenders may charge a higher interest rate to borrowers who are more likely to default, a practi... Read more
Keeping up with your accounts receivable is key to maximizing cash flow and identifying opportunities for financial growth and improvement. In being proactive and persistent in ensuring that debts owed are paid in a timely fashion, businesses can boo... Read more
When the bakery does not bake any cake, its variable costs drop to zero. Unlike fixed expenses, you can control variable costs to allow for more profits. Variable costs are expenses that change directly and proportionally to the changes in business. Read more
We’re here to take the guesswork out of running your own business—for good. Your bookkeeping team imports bank statements, categorizes transactions, and prepares financial statements every month. Self-employed business owners can also deduct he... Read more
Below, we'll dive in to explain what debits and credits mean in accounting. Despite the overlaps in roles and responsibilities, accounting and bookkeeping are two distinct functions. We hope that our post helped to provide clarification on the simila... Read more
It provides a real-time view of inventory levels at any given moment in time. A perpetual inventory does not need to be adjusted manually by the company's accountants, except to the extent it disagrees with the physical inventory count due to. Read more
This depreciation will be reported on the manufacturer's income statement in the section containing its SG&A expenses. Depreciation of a retailer's store displays, warehouse equipment, delivery truck, and buildings used in its selling and general adm... Read more
This method can be similar to selling off portions of loans often done by banks. The terms Receivables Based Financing and Factoring are often used interchangeably.The system offers the lure of getting immediate financing to enhance business growth. ... Read more
As an example, the electricity cost for your business will likely remain consistent if you run a service business. It might not be fun, but calculating your fixed costs on a regular basis will benefit your business in the long run.. Read more
