by Small Business Accounting Software | Jan 30, 2026 | Chart of Accounts, Expenses, Terminologies
Unlike corporations, sole proprietors don’t earn a formal salary; they draw money instead. However, some businesses track an “Owner’s Salary” account informally to monitor consistent withdrawals. It always closes out to drawings/capital at year-end.
by Small Business Accounting Software | Jan 9, 2026 | Chart of Accounts, Expenses, Terminologies
Represents taxes on net income owed to the government. Calculated based on taxable income, not accounting profit. A standard line item on income statements.
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 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.
by Small Business Accounting Software | Dec 17, 2025 | Chart of Accounts, Expenses, Terminologies
Fees incurred for bank services such as account maintenance, wire transfers, or overdrafts. Usually small but recurring. Essential for financial accuracy.
