Accounting articles

Liquidity Definition

You've probably heard the term "liquidity" thrown around when it comes to your portfolio and assets. As such, liquid assets are those that can easily be sold or traded. The current ratio, also known as the working capital ratio, is calculated by divi... Read more

Double‐entry Bookkeeping

Accordingly, regulators around the world attempt to seek conformity among national GAAPs and the IFRS. Perhaps most important, however, is the fact that the double-entry system of accounting is mandated by law. Double-entry bookkeeping is required un... Read more

Double Entry Definition

They’d have a ledger for every type of transaction, like a one for cash, accounts receivable, expenses, inventory, etc. Throughout the month, they would write down the debits and credits affecting certain accounts in their individual ledgers.In order... Read more

How To Prepare A Trial Balance

If there are inaccuracies in a business’s financial records, the purpose of a trial balance is to reveal these inaccuracies, and the result should be an adjusted trial balance that’s free of any discrepancies. The purpose of a trial balance in accoun... Read more

Wave Accounting Review 2021

If you're a very small business or freelancer in North America, Wave might be the ideal accounting software to organize your business and simplify tax time. However, if you have higher revenue, more complex requirements or plan to scale, Xero is like... Read more

Guiding Cost Principles

Now, the market value of machinery is $20,000, but as per books, after applying depreciation, the value is showing as $ 30,000. The difference between the two values is that the organisation follows the cost principle for its assets and has not consi... Read more

Days Sales Of Inventory Dsi

Based in Atlanta, Georgia, William Adkins has been writing professionally since 2008. He writes about small business, finance and economics issues for publishers like Chron Small Business and Adkins holds master's degrees in history of... Read more

What Is The Direct Write Off Method?

Unlike the allowance method, the direct write off method avoids contra asset account complications. Companies decide which accounts are uncollectible depending on various criteria.Instead, the allowance method of bad debts treatment is preferred. Whe... Read more