by Small Business Accounting Software | Dec 27, 2025 | Terminologies
The price at which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction. Often used in financial reporting and investment accounting. Ensures transparency in valuations.
by Small Business Accounting Software | Dec 26, 2025 | Chart of Accounts, Expenses, Terminologies
The cost of borrowing money through loans or bonds. Recorded based on accruals, not just payments. Impacts net income directly.
by Small Business Accounting Software | Dec 26, 2025 | Terminologies
The fundamental formula: Assets = Liabilities + Equity. It shows the relationship between what a company owns, owes, and the residual interest of owners. This equation must always stay in balance.
by Small Business Accounting Software | Dec 24, 2025 | Chart of Accounts, Expenses, Terminologies
Estimation of receivables that are unlikely to be collected. Recorded to align with the matching principle. Prevents overstated income.
by Small Business Accounting Software | Dec 23, 2025 | Chart of Accounts, Expenses, Terminologies
Spending on meals, events, or hospitality to build client relationships. Subject to regulatory and tax restrictions. Needs proper documentation for deductions.
