# Blog

## Cost of Debt How to Calculate the Cost of Debt for a Company

If you’re a small business owner, you know that borrowing money is both inevitable and essential. You need working capital to get your business off the ground or grow it to new heights. A free Google Sheets DCF Model Template to calculate the... Read more

## How to Calculate Bad Debt Expenses With the Allowance Method Chron com

The bad debts are the losses that the business suffers because it did not receive immediate payment for the sold goods and provided services. If 6.67% sounds like a reasonable estimate for future uncollectible accounts, you would then create an all... Read more

## Closing Entries in Accounting: Everything You Need to Know +How to Post Them

In a partnership, separate entries are made to close each partner's drawing account to his or her own capital account. If a corporation has more than one class of stock and uses dividend accounts to record dividend payments to investors, it usually... Read more

## How To Do A Bank Reconciliation: Step By Step

Typically, the difference between the cash book and passbook balance arises due to the items that appear only in the passbook. Therefore, it makes sense to first record these items in the cash book to determine the adjusted balance of the cash book... Read more

## How to Calculate Effective Interest Rate: Formula & Examples

You can compare various offers accurately only if you know the effective annual interest rate of each one. The format we presented for the effective interest rate can be used as an Excel formula. In the case of compounding, the EAR is always higher... Read more

## A Guide to Closing Entries: How to Prepare Them

If your business is a sole proprietorship or a partnership, your next step will be to close your income summary account. You can do this by debiting the income summary account and crediting your capital account in the amount of \$250. This reflects y... Read more

## Journalizing Closing Entries for a Merchandising Enterprise Financial Accounting

We do not need to show accounts with zero balances on the trial balances. This will ensure that the balances of those expenses account are transferred to the income summary account. These are general account ledgers that record transaction... Read more

## PTO Accruals Guide: How to Calculate PTO & Vacation Time

Hourly employees usually accrue PTO with every hour worked, but companies often update their PTO balances with each payroll cycle. This disparity can create real headaches and hardship for employees who need to use their PTO for an emergency, but wh... Read more

## How Salvage Value Is Used in Depreciation Calculations

An asset's salvage value subtracted from its basis (initial) cost determines the amount to be depreciated. Most businesses utilize the IRS's Accelerated Cost Recovery System (ACRS) or Modified Accelerated Cost Recovery System (MACRS) methods for thi... Read more

## How to Calculate Sales Tax: Complete Guide

Sales taxes are closely related to use taxes, which apply to items purchased from outside their jurisdiction. An optimal sales tax is one that is applied to a broad base of goods and services with a low tax rate. Such a tax system can minimize the a... Read more