Intermediate Accounting

Liability: Current & Long-Term Liability, Types of Liabilities

Liabilities are obligations to pay money, render future services, or convey specified assets. They are claims against the company’s present and future assets and resources.

Accounting For Long Term Investment

Long-term Investment is expected to be collected more than one or two years of the operating cycle or accounting period. A long-term investment is both equity and debt securities. The Following primary characteristics of long-term debt security are: Typical long-term debt securities include long-term notes payable, mortgages payable, pension liabilities, lease liabilities, and bonds payable….

Partnership Accounts

Partners Capital Account Types of capital accounts of the partners are; Fixed Capital If the partner agrees to keep the Capital Account at original figures from year to year in the book, then under this method, two accounts are opened for each partner; The capital account records the amount of capital contributed by a partner….

Contingency Liability: Types of Contingencies

A contingency is an existing condition, situation, or set of circumstances involving uncertainty about possible gain or loss to an enterprise that will ultimately be resolved when one or more future events occur or fail to occur. Contingency Liability Contingent liabilities are possible obligations arising from past events and depend upon the occurrence or non-occurrence…

Accounting For Short-Term Investments

Investments are classified on the balance sheet into two types: short-term investments and long-term investments. Companies have different motivations for investing in other companies (i) motivation is to earn a high rate of return, (ii) motivation for investing is to secure certain operating or financing arrangements with another company. Definition of Short-Term Investments A short-term…

Receivables: Types of Receivables, Calculation & Examples

In accounting, receivables are amounts owed to a company by customers or entities, representing the right to receive payment for goods or services. They are classified as assets on the balance sheet. What Are Receivables in Accounting? Receivables are claims against customers and others for money, goods, or services. For financial statement purposes, companies classify…

Accounts Receivable Recognition and Valuation

Accounts receivable are unpaid customer invoices representing money owed to a company. It is an asset on the balance sheet until payment is received. What is Accounts Receivable? A Receivable arising from goods sold on account. In most Receivable transactions, the amount to be recognized is the exchange price between two parties. The exchange is…

Notes Receivable Recognition and Valuation

Notes receivable are written promises by borrowers to repay a specific amount in the future. They represent financial assets on a company’s balance sheet.

Users of Accounting Information [Internal & External Users]

Users of accounting information are internal and external. External users are creditors, investors, government, trading partners, regulatory agencies, international standardization agencies, journalists and internal users are owners, directors, managers, employees of the company.