by Small Business Accounting Software | Oct 28, 2025 | Terminologies
Similar to depreciation but applied to intangible assets like patents, software, or franchise rights. It spreads the cost over the asset’s economic life. Ensures expenses align with benefits.
by Small Business Accounting Software | Oct 24, 2025 | Chart of Accounts, Terminologies
A broader account that reflects the residual interest in the business after liabilities are deducted from assets. It may be used in place of “Owner’s Capital” in simplified setups. Shows the owner’s true claim on the business.
by Small Business Accounting Software | Oct 24, 2025 | Terminologies
A model explaining factors that lead to fraud: pressure, opportunity, and rationalization. Widely used in auditing and forensic accounting. Helps organizations design better controls.
by Small Business Accounting Software | Oct 23, 2025 | Chart of Accounts, Terminologies
Represents amounts owed to government agencies for income, sales, or other taxes. Accurate calculation and timely payment prevent penalties. Reported as current liabilities.
by Small Business Accounting Software | Oct 22, 2025 | Chart of Accounts, Expenses, Terminologies
Spending on mailing letters, shipping products, or courier services. Often minor but necessary. Essential in businesses reliant on logistics.
by Small Business Accounting Software | Oct 22, 2025 | Terminologies
Requires a business to use the same accounting methods from period to period. This allows for comparability across time. Any changes must be disclosed and justified.
by Small Business Accounting Software | Oct 21, 2025 | Terminologies
A ratio that shows how many times a company sells and replaces its inventory during a period. High turnover indicates efficiency, while low turnover may signal overstocking. Critical in retail and merchandising businesses.
by Small Business Accounting Software | Oct 17, 2025 | Assets, Chart of Accounts, Terminologies
When the owner lends money to the business with the intention of repayment, rather than contributing capital. Classified as a liability for the business until paid back. Keeps a distinction between investment and temporary financial support.
by Small Business Accounting Software | Oct 17, 2025 | Chart of Accounts, Expenses, Terminologies
Costs of electricity, water, gas, and internet. Essential for daily operations. Variable depending on usage and seasonality.
by Small Business Accounting Software | Oct 14, 2025 | Chart of Accounts, Terminologies
Earnings from allowing others to use intellectual property like patents, copyrights, or trademarks. Provides passive income streams. Recognized per contract terms.
by Small Business Accounting Software | Oct 13, 2025 | Terminologies
The study of differences between actual results and budgeted or standard figures. Identifies areas requiring attention or improvement. A vital managerial accounting tool.
by Small Business Accounting Software | Oct 10, 2025 | Chart of Accounts, Expenses, Terminologies
The cost of items like pens, paper, and printer cartridges consumed during operations. Recorded when used, not purchased if immaterial. Distinct from inventory.
