Nonprofit entities and government agencies use similar financial statements; however, their financial statements are more specific to their entity types and will vary from the statements listed above. Accounting is a back-office function where employees may not directly interface with customers, product developers, or manufacturing. However, accounting plays a key role in the strategic planning, […]

A contra revenue account is a revenue account that is expected to have a debit balance (instead of the usual credit balance). In other words, its expected balance is contrary to—or opposite of—the usual credit balance in a revenue account. The contra asset account Accumulated Depreciation is deducted from the related Capital Assets to present […]

This can include unexpected expenses that arise throughout the year or ongoing expenses that may be easy to forget. Overlooking expenses can lead to a budget shortfall and cause financial strain on the business. This involves aggregating all of the separate budget items and ensuring that they are aligned with the overall goals and objectives […]

Exemptions are allowed for newspapers, magazines, books used for religious worship, and educational textbooks. If you’re a service provider with questions about the taxability of your transactions, refer to the Services Enterprises regulation, 830 CMR 64H.1.1, or contact our Rulings and Regulations Bureau at Newsletters, however, are generally not treated as newspapers and may be […]

This method results in a larger depreciation expense in the early years and gradually smaller expenses as the asset ages. It’s widely used in business accounting for assets that depreciate quickly. On the other hand, with the double declining balance depreciation method, you write off a large depreciation expense in the early years, right after […]

Unearned revenue plays a crucial role in accrual accounting, as it represents cash received from customers for services or products that have not yet been delivered. It is recorded as a liability because the company still has an outstanding obligation to provide these goods or services. The company sends the newspaper to its customer each […]