A bank or investment account with a fluctuating interest rate. Usually the funds can be withdrawn on demand, even though the account is not a checking account.
A bank or investment account with a fluctuating interest rate. Usually the funds can be withdrawn on demand, even though the account is not a checking account.
Is a money market account a current asset or a fixed asset? Author: Harold Averkamp, CPA, MBA A money market account is a current asset unless it is restricted for a long-term purpose. The amount of an unrestricted money...
rate than is paid on a regular savings account or money market account. The length of a certificate of deposit will vary. It could be for one month, three months, six months, one year, 17 months, three years, etc....
Our Explanation of Nonprofit Accounting includes a chart that contrasts the financial statements of a nonprofit (or not-for-profit) organization with those of a for-profit business corporation. There are many examples to...
and EOM? Is a money market account a current asset or a fixed asset? What is a debenture? What does it mean to recognize an expense? Where should a business report cash which is restricted to purchase a long-term asset?...
month to month. I suspect our accounting is not proper. Any suggestions? Is a money market account a current asset or a fixed asset? What does it mean to recognize an expense? Kindly illustrate various depreciation...
The recognition that a dollar in the present is more valuable than a dollar in the future. Present-value calculators and present-value tables assist in converting future dollars to the present value in order to make a...
A company’s sales in a market as compared to the total sales in that market. For example, General Motors share of the U.S. market has decreased from more than 50% in the 1960’s to its present market share of...
A structured market for trading stocks and bonds such as the New York Stock Exchange or NASDAQ. Capital market can also include less structured markets such as private placements.
The amount that would be agreed upon by two independent persons. The amount to be received in the ordinary course of business in an arm’s length transaction.
Also referred to as the current interest rate, the yield-to-maturity, and the effective interest rate. The market interest rate is always changing whereas the stated interest rate does not change.
, Capital. If Amy Ott also lends some money to the business, the entry will be to debit Cash and credit a liability account such as Notes Payable. (If Amy invests an asset other than cash, the business will record the...
What is the time value of money? Author: Harold Averkamp, CPA, MBA Definition of Time Value of Money The time value of money recognizes that receiving cash today is more valuable than receiving cash in the future. The...
What is the definition of capital market? Author: Harold Averkamp, CPA, MBA Often, capital market refers to the structured market for trading stocks and bonds. Examples are the New York Stock Exchange, the American Stock...
Our Explanation of Accounting Basics uses a simple story to introduce important accounting concepts and terminology. It illustrates how transactions will be included in a company's financial statements.
on Sunday, June 4. On Monday, June 5, the money is counted and is deposited into the church’s bank account. The transaction to record the cash and the revenues (remember double entry) should be dated Sunday, June 4,...
-in capital and as corporation’s permanent capital. Typically, a corporation issues shares of its common stock and receives cash for the stock’s fair market value. The transaction will be recorded with a debit to the...
Is the drawing account a capital account? Author: Harold Averkamp, CPA, MBA Definition of Drawing Account A sole proprietorship will have a drawing account in which the owner’s withdrawals or draws of cash or other...
are not accrual accounting amounts; rather they are future __________ cash amounts. 5. If the cash amount of a transaction is not known, accountants will record the transaction at the fair __________ market value of the...
What is a cash cow? Author: Harold Averkamp, CPA, MBA A cash cow is often a profitable product or service that dominates a market and generates far more cash than is needed to maintain its market position. Companies may...
Our Explanation of Present Value of a Single Amount discusses the time value of money and the need to discount future amounts to the time of an investment or other transaction. The present value of 1 table is used to...
Our Explanation of Bonds Payable covers the recording of bonds, the accrual of interest expense, and the amortization of the discount and premium on bonds payable. You gain an understanding on why the market value of...
of present values, the payment amounts that are discounted are not accrual accounting amounts; rather they are __________ cash amounts. 5. If the cash amount of a transaction is not known, accountants will record the...
value = $44,000 to the Land account Assign or allocate 88% of the $200,000 market value = $176,000 to the Buildings account Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your...
their land investments at the market values. As a result: Mary’s land will sell for $400,000 which means a $100,000 loss on the land’s cost of $500,000. The $100,000 loss on Mary’s cash of $500,000 results in a...
. When a company receives money, it debits Cash. Every transaction will require a debit to at least one account and a credit to at least one other account. Here are two examples to illustrate our five tips. A bakery...
On credit; not for cash.
A record in the general ledger that is used to collect and store similar information. For example, a company will have a Cash account in which every transaction involving cash is recorded. A company selling merchandise...
Our Explanation of Present Value of a Single Amount discusses the time value of money and the need to discount future amounts to the time of an investment or other transaction. The present value of 1 table is used to...
What type of account is the Dividends account? Author: Harold Averkamp, CPA, MBA Definition of Dividends Account When a corporation declares a cash dividend, the amount declared will reduce the amount of the...
securities. Marketable equity securities include shares of common stock and most preferred stock which are traded on a stock exchange and for which there are quoted market prices. Marketable debt securities include...
This term is often associated with an investment in the common stock (and/or preferred stock) of a corporation when the stock is publicly traded.
Investments in common stock, preferred stock, corporate bonds, or government bonds that can be readily sold on a stock or bond exchange. These investments are reported as a current asset if the investor’s intention...
Generally, securities that can be sold quickly in the stock or bond market and where the investor’s intention is to sell them within one year of the balance sheet date.
This term is often associated with an investment in the bonds issued by another corporation if the bonds are traded on a bond exchange.
Our Explanation of Bonds Payable covers the recording of bonds, the accrual of interest expense, and the amortization of the discount and premium on bonds payable. You gain an understanding on why the market value of...
Our Explanation of Bonds Payable covers the recording of bonds, the accrual of interest expense, and the amortization of the discount and premium on bonds payable. You gain an understanding on why the market value of...
of the discount. The smaller the time value of money, the smaller the amount of the discount. In turn, a larger discount will mean a smaller present value. A smaller discount will result in a greater present value. DCF...
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