All 1002 questions have been answered personally by Harold Averkamp, CPA, MBA. Harold is the sole-author of all the instructional content found on AccountingCoach.com.
In accounting, Notes Payable is a general ledger account in which a company records the face amounts of the promissory notes that it has issued. The amounts for the promissory notes (or simply notes) that have not been repaid are reported as… Read More.
A checking account is a bank account in which a company deposits money and can subsequently withdraw the money by writing a check, by using a debit card, arranging for electronic transfers, etc. Except for the uncollected funds associated with recently deposited… Read More.
A long-term liability is a noncurrent liability. That is, a long-term liability is an obligation that is not due within one year of the date of the balance sheet (or not due within the company's operating cycle if it is longer than… Read More.
In accounting, a credit balance is the ending amount found on the right side of a general ledger account or subsidiary ledger account. A credit balance is normal and expected for the following general ledger and subsidiary ledger accounts: Liability accounts. These… Read More.
Direct labor refers to the employees and temporary help who work directly on a manufacturer's products. (People working in the production area, but not directly on the products, are referred to as indirect labor.) The direct labor cost is 1) the cost… Read More.
The time value of money tells us that receiving cash today is more valuable than receiving cash in the future. The reason is that the cash received today can be invested immediately and will begin growing in value. For instance, if a… Read More.
Depreciation expense is the allocated portion of the cost of a company's fixed assets that is appropriate for the accounting period indicated on the company's income statement. For instance, if a company had paid $2,400,000 for its office building (excluding land) and… Read More.
Under the accrual basis of accounting, insurance expense is the cost of insurance that has been incurred, has expired, or has been used up during the current accounting period for the nonmanufacturing functions of a business. (The insurance costs incurred for manufacturing… Read More.