Accounting Category: Expenses

Accounting Articles

September 14, 2014

Depreciation might sound simple in theory - the company buys a fixed asset and then writes off the cost over a period of time. But what if a company has hundreds or thousands of depreciable assets, each with its own cost, salvage value, and useful life? What if a particular machine has several dozen separate parts that must be replaced at different times? Situations like this call for specialized methods of depreciation.

September 6, 2014

In the first two parts of this article series, we discussed general capital lease accounting. For this final article, we値l take a brief look at a special kind of transaction called a sale-leaseback.

August 31, 2014

In the first part of this article series about capital lease accounting, we discussed accounting for the asset and related liability from the perspective of the lessee. Now we値l turn to other side of the transaction to look at accounting from the lessor痴 perspective.

August 24, 2014

In this three-part article series, we値l discuss the accounting treatment for various aspects of a leasing arrangement. This first part will cover capital lease accounting by the lessee (the party that takes possession of an asset in exchange for monthly lease payments).

August 17, 2014

This article touches upon accounting for stock options which was (and still is) a hot topic in the accounting realm.

July 1, 2014

We have previously discussed various methods of estimating bad debt expense, including percentage of sales and percentage of accounts receivable. In this article, we expand on the percentage of accounts receivable method by incorporating accounts receivable aging.

June 2, 2014

The matching principle tells us to expense costs in the same period that those costs provide some benefit to the company. Interpretation of the matching principle gets a bit fuzzy when dealing with research and development.

January 26, 2014

Many of the accounting principles on this website apply to any type of company. In this series of articles, we focus on the basics of accounting for partnerships, a business entity formed by two or more owners that is less structured than a corporation.

January 18, 2014

Company managers need to keep track of costs in order to make wise decisions about day-to-day operations. In this article, we discuss process costing, a method of allocating costs for manufacturers of many identical products.

January 11, 2014

The process of tracking production costs is critical for the information needs and reporting requirements of manufacturers. In this article, we値l discuss a method of cost distribution called job costing. After describing the theory behind job costing, we値l walk through an example - a manufacturer of drag race engines.

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