The Statement of Functional Expenses

Nonprofits must follow all donor requests, and these donations must be listed under restricted funds on a Statement of Activities. A Statement of Activities is one of the four required financial statements a nonprofit must file. Nonprofit accounting can retained earnings feel complicated for nonprofits without a solid financial background, but there are ways to make filing reports easier. A Statement of Activities is similar to a for-profit income statement and is one of the

By Petra Burdová | | In Bookkeeping | Read More

Balance Sheet vs Income Statement: How Do They Differ?

It is a vital financial tool that provides insight into a company’s profitability and performance. It helps assess financial health using ratios, such as current ratio, debt-to-equity ratio and return on shareholder’s equity. While these statements serve different purposes, they are interdependent. The income statement impacts the balance sheet through retained earnings, which is part of the equity section. This helps provide a comprehensive picture of the company’s financial activity to track growth and compare

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Free on Board FOB Explained: Who’s Liable for What in Shipping?

While the seller does bear higher costs under FOB destination, they can factor shipping costs into pricing. While FOB shipping point does transfer risk to the buyer, it may affect a seller’s reputation and sales conversion rate. Shipping costs are reduced, but fewer buyers are willing to accept shipping point terms, especially on large or fragile orders. Read all contracts carefully, calculate potential costs, purchase insurance—and consider negotiating additional terms in your shipping or sales agreement

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Contra Account Definition + Journal Entry Examples

Contra equity accounts, therefore, act as a ledger for corporate strategy, impacting how the worth of a company is perceived from the outside. Explore the purpose and types of contra accounts in financial statements, enhancing clarity and accuracy in financial reporting. This allows the company to reflect a more accurate balance for its accounts receivable. Discount on notes payable is a contra liability account that is used to offset the balance of the notes payable

By Petra Burdová | | In Bookkeeping | Read More