December 02, 2019
Charles Lutwidge
What is a general ledger account?
Definition of General Ledger Account The general ledger (GL) is the main consolidated accounting register, which reflects data on the company’s entire financial transaction history for all bookkeeping accounts used by the company. Businesses can maintain the general ledger on...
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December 02, 2019
Charles Lutwidge
What Is a Contra Account: Definition and Example
Define Contra Asset Account A contra account is a type of asset account that has a credit balance, as opposed to the debit balance of a normal asset account. A contra account will naturally have an associated account, and the...
December 02, 2019
Charles Lutwidge
What is a contra revenue account and why is it important to my small business bookkeeping?
If you are a small business owner and you sell a product, you likely have instances of returns/refunds on items or you may provide reductions for items that are defective or damaged. If you provide either a product or a...
November 27, 2019
Charles Lutwidge
Royalties in Accounting
The concept of “royalty” came from the Latin language, where “regalis” meant “royal”. Today, the term has nothing to do with monarchs, but it directly relates to finances, money, making a profit. Royalty is a type of monetary reward for...
November 26, 2019
Charles Lutwidge
The Difference Between Accruals and Deferrals
When it comes to accounting, timing is everything. To allocate revenues and expenses to the right accounting period, accountants use accruals and deferrals. This approach also helps with comparing financial statements from different periods. Accruals and deferrals follow the Matching...
November 11, 2019
Charles Lutwidge
Normal Balance of Accounts: Definition and Examples
Accurate record-keeping plays a vital role in managing your finances and making informed business decisions. However, setting up and maintaining your accounting books requires a basic understanding of accounting terminology. What is a normal balance of accounts? Which account has...
September 30, 2019
Charles Lutwidge
Accounting Equation Definition
The accounting equation is a fiscal formula used to calculate the relationship between various economic indicators within a business. This equation is usually presented in the form of a simple breakdown of values on a balance sheet. The accountancy formula...
September 30, 2019
Charles Lutwidge
What is Unearned Revenue in Accounting?
Revenue is an increase in an enterprise’s economic benefits over a specified reporting period. Revenue may come in the form of a revenue receipt (this is money received through regular business operations), asset sales, or a decrease in liabilities. Revenue...
