Financial Accounting

When a bond is issued, the corporation or company that issued the bond needs to maintain proper accounting transactions. The proper journal entry for bonds is very important. The journal entry for bond issuance varies depends on the type of issuance; whether it is issued at par, at a premium, or a discount.  In this

When a corporation or company issues a bond, it comes with maturity. However, the bond can be retired before maturity or retirement by conversion. The journal entry for bond retirement is the difference between the retirement at the maturity, before maturity, and by conversion. In this article, we cover the bond retirement journal entry. This

What is Accrued Expense? When a company incurs expenses while the payment has not been made, such expenses shall be recorded as accruals. Thus, these accruals are called accrued expenses. Therefore, we can basically define the accrued expenses as the liability which results from the goods or services that have been received; however, the payment

What is Unearned Revenue? When a company receives cash or payment while the goods or services have not been delivered or provided for, it is called unearned revenue. Thus, we can define it as the liability which results from the cash received in advance while the goods or services have not been delivered or provided

The activity-based depreciation method of assets takes into account the output of assets. It mainly differs from other methods of depreciation on the very nature of the cost spreading method. Other depreciation methods consider time as the main cost spreading factor. The activity-based depreciation method considers the number of units or the output from the

Error in accounting incurs as a result of the wrong entry recorded by bookkeeper or accountant. There are different types of errors in accounting; some of them can result in an imbalance of trial balance. Error is considered as an unintended mistake during the course of recordkeeping. Typically, material errors would lead to incorrect decision

Earnings per share is the part of an organization’s benefit, which is distributed to every individual share of the stock. It holds much significance to shareholders and individuals who exchange in the stock market. When the earnings per share of a business are high, then its productivity also increases. For determining the earnings per share,

The main source of finance for companies, especially small-size companies and startups, is equity finance. Equity finance consists of finance that companies raise through their shareholders. In exchange for the finance they provide, shareholders receive the shares of the company. The shares of a company give its shareholders the ownership of the company for the