When you start working with time value of money problems, you need to pay attention to distinguish between present value and future value problems. One way to solve present value problems is to apply the general formula we developed for the future value of a single amount problems. Problems and questions like this are known […]
Bookkeeping
Gross Profit vs Operating Profit vs. Net Income: Whats the Difference?
This gross profit margin assesses the profitability of your business’s manufacturing activities. The net profit margin provides a picture of your business’s overall profitability. Together, they give you an idea of your business’s financial health, empowering you to track trends and make quick business decisions. They will tell you the same basic relationship of revenues […]
7 3 Analyze and Journalize Transactions Using Special Journals Principles of Accounting, Volume 1: Financial Accounting
Periodically, and no later than the end of each reporting period, the information in the purchases journal is summarized and posted to the general ledger. This means that the purchases stated in the general ledger are only at the most aggregated level. If a person were researching the details of a purchase, it would be […]
Owner’s Draw vs Salary: How to Pay Yourself as a Business Owner
The owner remains the business’s sole owner regardless of how much money they take out. Your financial situation can also impact your salary vs owners draw decision to take a salary or an owner’s draw. If you need a steady income to pay private bills, a salary may be a better option. The self-employment tax […]