OSYB Blog: Number Crunch!
News and Views from OutSource Your Books, LLC
Limitations of Accounting & Financial Statements
August 25, 2015 by Ed Becker
The last several weeks we have discussed in detail the financial statements, what they do individually and how they are dependent on each other for a larger picture as well as who uses/views them and for what purposes. Today is the final segment in this series, we will discuss the limitations of the financial statements […]
Ordinary AND Necessary Business Expenses
August 20, 2015 by Ed Becker
The AND is the important word in this title and in the IRS explanation of allowable business expenses. Deductible expenses have to be both, ordinary AND necessary. What does that mean to you as a business owner? The IRS does not explain it separately very well, so we will look deeper into each. Ordinary expenses […]
The Relationship Between Financial Statements: Articulation
August 14, 2015 by Ed Becker
The financial statements are not isolated items, they are closely related and flow between each other to give a larger picture of the business’ financial circumstances. Each statement can stand alone to offer a snapshot of the given information. But separately, they do not allow an in depth view of the whole financial state of […]
The Statement of Changes in Equity or Statement of Retained Earnings Explained
August 1, 2015 by Ed Becker
The statement of changes in equity is also called the statement of retained earnings in U.S. GAAP. This statement explains the change in owner’s equity during a specific accounting period by detailing the movement of reserves that make up the shareholder’s equity. This statement offers vital information about equity reserves not found anywhere else in […]
The Income Statement or Profit and Loss Account Explained
July 28, 2015 by Ed Becker
The Income Statement, or the Profit and Loss Account, reports income expenses and the amount of profit and loss for stated accounting period. It offers information to measure the performance of the company over the entire accounting period. As well as offering information for financial evaluation of the company when reviewed with other financial statements […]
The Statement of Cash Flows, or Cash Flow Statement Explained
July 22, 2015 by Ed Becker
The Statement of Cash Flows, or Cash Flow Statement, offers information about the solvency of a company. It presents the movement of cash during the accounting period within the operating, investing and financing categories. Projections for financial and economic decisions can be formed from information on historic cash flows. Analysis and summaries of key changes […]
The Balance Sheet: Statement of Financial Position Explain
June 29, 2015 by Ed Becker
In part one of this series, we talked about what the financial statements are and what purpose they have in businesses. We also discussed the trial balance being an important part of the process of preparing the financial statements, but not actually being a statement. Here we will discuss in depth the Statement of Financial […]
Financial Statements- Everything You Need to Know Part 1- Trial Balance
June 21, 2015 by Ed Becker
If you are around business people or accounting personnel you have heard of financial statements. Owning or running your own business usually requires producing these statements on a regular basis. If you are seeking financing, the lender is going to ask for certain financial statements in order to approve your request. So just what are […]
