What are Retained Earnings?

How to Calculate the Dividend Payout Ratio It is the opposite of thepayout ratio, which measures the percentage of profit paid out to shareholders as dividends. Essentially, retained earnings are what allow a business’s balance sheet to ultimately balance. They fit in neatly between the income statement and the balance sheet to tie them together. […]

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Why is a debit a positive?

A general rule of thumb is that a current asset can or will be used within one year and a fixed asset can’t or won’t be converted to cash within a one-year period. The balance sheet addresses current assets before getting into fixed assets. Why is a credit a debit in accounting? From the point […]

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Depreciable asset

The most common types of depreciation methods include straight-line, double declining balance, units of production, and sum of years digits. There are various formulas for calculating depreciation of an asset. Depreciation expense is used in accounting to allocate the cost of a tangible asset over its useful life. https://www.thebalance.com/retained-earnings-on-the-balance-sheet-357294 Some businesses, though, prefer an accelerated […]

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Study Skills: Learn How To Study Accounting

We now offer eight Certificates of Achievement for Introductory Accounting and Bookkeeping. The certificates include Debits and Credits, Adjusting Entries, Financial Statements, Balance Sheet, Income Statement, Cash Flow Statement, Working Capital and Liquidity, and Payroll Accounting. In most cases, accountants use generally accepted accounting principles (GAAP) when preparing financial statements in the United States. After […]

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