Phoenix Arizona CPA | Arizona Tax Accountant | Arizona Income Tax

In this article we will also discuss:

Revenue

Expenditure

The use of goods and services in order to earn revenue is the expense.

Hendriksen opines, “expenses are the using or consuming of goods and services in the process of obtaining revenues”.

American Accounting Association, Committee on concepts and standards, defines as under: Read the rest of this entry »

Are you considering firing your current accountant in favor of a new one? If so, you’re probably not sure if you’re overreacting or if you have just cause. The following warning signs will help you decide if it is time for you to change accountants:

Your accountant does not return your phone calls in a timely manner, if at all. Read the rest of this entry »

This article deals with a brief overview of some of the differences between financial accounting and management accounting systems. But at first let us understand what accounting is.

What is accounting? Accounting may be defined as a system of collecting, summerising, analysing, and reporting in financial terms, information about a business organisation. The business accounting as understood today, comprises of, financial accounting, and management accounting. These two parts of the business system have something in common and there are differences as well. Read the rest of this entry »

Many people often ask themselves the question “do I need an accountant, or, can I do my tax return myself and save the money?” Sometimes it might seem counter-intuitive, however, hiring an accountant can save you a lot of money as well as hassle and time.

It’s also a good question as it’s not about what you earn, rather, it’s all about what you get to keep! Read the rest of this entry »

Assets

An asset may be defined as anything of use to future operations of the enterprise and belonging to the enterprise. For example, building, land, machinery, cash, debtors (amount due from customers) goodwill etc.

Equity

In broad sense the term equity refers to total claims against the enterprise. It is further divided into two categories:

(1) Owners claim-capital and (2) Outsiders’ claim-liability (3) Liability: Amounts owed by the enterprise to the outsiders i.e. to all others except the owner. For example, trade creditors, bank overdraft etc. (4) Capital: The excess of assets over liabilities of the enterprise. It is the difference between the total assets and the total liabilities of the enterprise. For example, if on a particular date the assets of the business amount to $ 1,00,000 and liabilities to $ 30,000 then the capital on the date would be $ 70,000. It is also known as net worth. Read the rest of this entry »

Accounting vs. Book-keepingBook-keeping concerns itself with the recording (correctly and in a set of books) of those transactions that result in the transfer of money or money’s worth. Whereas accounting is comprehensive in perspective. It extends to classifying, summarizing, presenting and even analyzing accounting information .

Accounting vs. Accountancy

Body of knowledge (consisting of principles, postulates, assumptions, conventions, concepts and rules) governing the science of recording classifying and analyzing financial transactions is accounting. Whereas the practice and art of the Read the rest of this entry »

A balance sheet may be defined as “a statement prepared with a view to measure the exact financial position of a business on a certain date.

“It is prepared from the trial balance after all the balances of nominal accounts are transferred to trading and profit and loss account and corresponding accounts in the ledger are closed. The balances now left in the trial balance are either personal or real accounts. In other words, they either represent assets or liabilities existing on the date of closing of accounts. Read the rest of this entry »

Accounting, a.k.a. “The Language of Business”, is a large and diverse topic.  Subtopics include financial accounting, cost accounting, management accounting, internal auditing external auditing, international accounting, governmental and not-for-profit accounting and taxes.  The subtopic that comprises the largest portion of an accountants academic program of study is financial accounting.

The purpose of financial accounting is basically to provide useful information to users who will use that information to make a decision, most commonly either an investment or a credit decision.  To be useful information needs to be relevant and reliable.  The most common means of conveying information to users is through the preparation of financial statements:  1. the income statement, 2. the balance sheet, 3. the statement of cash flows, and 4. the statement of shareholders’ equity. Read the rest of this entry »

Most people find financial statements identical to a foreign language.  To ensure that financial statements are easier to understand, there is a set of rules and practices known as the generally accepted accounting principles (GAAP). Development of these rules provides a basic guideline accounting because I think it’s fair to say that it can get obtuse at times. There are a lot of variations to the meaning so here is the best answer.  It’s the generally accepted accounting rules and procedures that are necessary to define accounting practice. Basically it’s a set of theories that accountants come to accept, and controversies are lively with some methods between accountants. Read the rest of this entry »

Traditionally Accountants have been seen as something to be feared and a necessary evil, but things are changing.  Accountants need to look at their attitude to their clients and perhaps rethink the approach they use.  Many people feel daunted and intimidated by a visit to the Accountant and this need not be the case.  Adopting a new approach will ensure that Accountants keep their clients longer and are able to better understand the needs of the individual.

Applied Accountancy is a vibrant forward looking Accountancy Practice based in Maidstone, Kent. Owned and led by Paul Baker, a young, energetic and successful Accountant who came from a family of Accountants. Paul has eradicated the myth Read the rest of this entry »