Accounting software are gaining popularity rapidly, especially among small and large enterprises. However, there are a lot of accounts that are unfamiliar to business owners; one such account is opening balance equity. This account is not found in traditional bookkeeping, regardless of whether it’s done on paper or on any other platform like Excel. Opening-balance…
“Startups don’t fail because they lack a product; they fail because they lack customers and a profitable business model.” -Steve Blank Profitability models matter regardless of the size of a business. These models illustrate how you plan to upscale your business and your goals to make the business profitable. You might be familiar with revenue…
Depreciation is a devaluation of an asset over a period of time. Your tangible assets like equipment, vehicles, building, furniture, and machinery are all examples of depreciable assets. If you own an asset used for income-producing activity, it will depreciate as well. According to the IRS, you have to deduct an amount from the asset’s…
As per Self Financial, a financial technology company, Americans pay on average $525,037 each in taxes over a lifetime? Out of which about 65% is the income tax. Sale, property, and auto are other taxes contributing to the average tax rate. However, $525,037 doesn’t give a definite answer to how much does the average American…
Before the advent of accounting software, all the financial statements and accounting tasks were managed manually. The process was called the accounting cycle. The most vital component of an accounting cycle is a trial balance. It is the document that has all of the financial information of a business compiled in one place. All the…
Double declining balance depreciation – an easy way to save money with regard to your business expenses. The double declining balance method helps your asset’s value depreciate less and less over time. This means the biggest taxes are written off after you have purchased a business asset such as equipment, vehicle, tool, or real estate. Does this…
Depreciation is a process that defines the gradual decrease of the cost of a fixed asset over a period of time while it is in use. Depreciation plays a vital role in the accounting process of the business as it allows the company to recognize the devaluation of the asset over time. This helps in…
Pro forma is a Latin term which means “for form.” In short, the pro forma financial statements are the “what-if” statement generators. They allow you to explore different hypothetical situations and their impact on your business. According to Harvard Business School, pro forma financial statements are “financial statements forecasted for future periods. They may also…
California houses about 4 million small businesses, which ultimately employ over 7 million people. Small enterprises have taken over the State of California, making up about 99.8% of all the businesses in California. They have transformed the economy of the golden state. Contrary to the economic growth, California imposes higher income taxes compared to other…
“Accounting is a tool to get to what clients really need: advice on all affairs directly and indirectly related to financials.” – Marc Rosenberg This quote sums up accounting advisory services. If someone asks what is advisory in the accounting field? The answer is simple, it’s the guidance that you provide to your clients to…
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