by Small Business Accounting Software | Apr 11, 2026 | Terminologies
Guides accountants to anticipate losses but not gains, meaning potential expenses and liabilities are recognized promptly while revenues are only recorded when certain. Ensures financial statements are not overly optimistic.
by Small Business Accounting Software | Apr 7, 2026 | Chart of Accounts, Terminologies
Withdrawals made by the owner for personal use. It reduces the owner’s equity. Common in sole proprietorships or partnerships.
by Small Business Accounting Software | Apr 7, 2026 | Terminologies
Supporting documents accountants prepare during audits or reporting. They include schedules, reconciliations, and analysis used to verify accounts. Provide evidence and reference for conclusions.
by Small Business Accounting Software | Apr 7, 2026 | Terminologies
States that assets should be recorded at their original purchase price, not market value. Provides objectivity and verifiability. Though simple, it may understate asset values in inflationary times.
by Small Business Accounting Software | Apr 7, 2026 | Terminologies
Expenses not directly traceable to a product or service, such as utilities or office salaries. Allocated based on estimates or cost drivers. Form part of overhead.
by Small Business Accounting Software | Apr 6, 2026 | Chart of Accounts, Expenses, Terminologies
Direct costs of producing goods sold, including materials and labor. It directly impacts gross profit. Accurate calculation is essential for pricing and profitability analysis.
