0
Add your answer:
Earn +20 pts
Which accounts are closed in the closing entries?
Closing entries close out your temporary or "income statement" accounts, as well as your dividends paid account. All of your revenue accounts increase your retained earnings, expense accounts decrease retained earnings, and dividends paid decrease retained earnings.
What increases retained earnings balance sheet?
more revenue or less expense or a combinatio of both
Which of the following items has no effect on retained earnings expense land purchase dividends revenue?
Land purchase
What is the bookkeeping entry for a revenue reserve?
The bookkeeping entry for a revenue reserve is a debit to the retained earnings account and a credit to the revenue reserve account. This entry is made to set aside a portion of the profits as reserves for future use or to cover potential losses. By separating the revenue reserve from retained earnings, it allows for better tracking and management of the reserve funds.
Is sales an asset account?
Sales is generally considered "Revenue" or "Income" and therefore are an Owners Equity Account. Sales affect Retained Earnings and Retained Earnings affects Owners Equity.
What are the differences between dividend and expense accounts?
Dividend account is the account used to record money paid on stock such as common stock, this comes out of retained earnings. Expense accounts are expenses that the company has to maintain operation and come out of Revenue, before dividends are calculated. A company may choose to not pay dividends on stock for a year (or so) if the company's retained earnings do not meat a certain amount.
4 How is it possible to have taxable income which means a property is profitable yet have negative cash flow?
Income is not the same thing as retained earnings. A company may have a profit in revenue but show a net-loss in retained earnings. Gross Income (revenue) is what a company makes, Net Income (revenue) is the balance after all expense are paid, and Retained Earnings is the actual "profit or loss" a company retains after any dividends to stockholders are paid (if applicable).For example, say a company has an income of $15000, taxes are figured usually on the full amount, say taxes are 16% and the company has total expense of $14000. To figure their "retained" earnings, we figure Tax expense $2400 + $14000 (other expense) = $16400 (total expenses)Revenue $15000 - Total Expenses $16400 = (-$1400) loss
Dividend account is treated as either asset account liability account or expense account?
Hi, Dividends are paid out of retained earnings (part of Capital) therefore I think Dividends can not be treated as an expense (the prudence being increase in Capital can not be treated as Revenue thats Cash generation while dividends are Surplus appropriation). regards, Zeeshan
Which T-accounts follows the rules of debit and credit in relation to increases and decreases in the opposite manner?
Normal Balance Debit: (Asset, Expense, Dividend) Accounts Receivable Inventory Equipment Supplies Prepaid Rent Prepaid Insurance Cash Supplies Expense Depreciation Expense Rent Expense Salaries Expense Cost of Goods Sold Normal Balance Credit: (Liability, Shareholder Equity, Revenue, Retained Earnings) Accounts Payable Salaries Payable Accumulated Depreciation Retained Earnings Unearned Revenue Service Revenue Common Stock
Where does the fund for payroll come from Does it come from net income/retained earnings?
The difference between revenue and retained earnings is that revenue is the ... they are derived from net income on the income statement and contribute to ..
How do you calculate gross equity?
Owner's Equity = Contributed Capital ± Retained Earnings Contributed capital is money that has been contributed to a company by its owners or by a direct investment made by stockholders in a corporation. A company would have stockholders if that company sells shares or stock. Retained earnings is a companys' accumulated profits that have been put back or reinvested into the company. Some examples of retained earnings are supplies expense, rent expense, wages expense, interest expense, utilities expense, sales revenue, cost of goods sold, and depreciation expense. A return on equity (ROE) is the net income divided by stockholders' equity. Assets = Liabilities + Owners Equity
What is retained earnings and general reserve?
Retained Earnings are the accumulated profits and losses of a company over time (less any dividends or distributions to stockholders). At the end of each fiscal year, the income and expense accounts are zeroed out and the net profit or loss for the year is posted to Retained Earnings. So if a company made $10,000 Net Income per year for it's first three years (and paid no dividends), at the end of year three, Retained Earnings would be $30,000.
