Accounting and Tax Services in Richmond, VA .

Accounting word of the week

Today we are looking at the word Owners’ Equity. Owners’ Equity means the interest of the business owners in the assets of the business represented by capital contributions and retained earnings. It is part of the balance sheet equation of Assets = Liabilities + Owners’ Equity. In essence, Owners' Equity is the amount of money that the business owner has invested into the business minus any money that the owner has taken out of the business what is known as a draw. This doe

The Closing Process

As we approach the end of the year, allow me to focus on the closing process. The closing process is a method whereby it reduces the balance of nominal (temporary) accounts to zero in order to prepare the accounts for next period’s transactions. A company will transfer all revenue and expense account balances, known as income statement items, to a clearing or suspense account. This is also called the Income Summary. The matching rule applies here as well. The income summar

Accounting word of the Week

As we our fast approaching the end of the year, I would like to start addressing a few things to remember in the next couple of weeks. Today, I would like to discuss what is in the meaning of year-end adjustments. The process is for the business to adjust multiple accounts at the end of the fiscal year (or can be done quarterly) in order to correctly state it for financial statement prepartion purposes. There are a few types of adjustments that are needed: accrual or deferr

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