It’s important to note that although dividends reduce retained earnings, they are not expenses. Therefore, dividends are excluded when determining net income (revenue 8211; expenses), just like stockholder investments (common and preferred). It’s called the Balance Sheet (BS) because assets must equal liabilities plus shareholders’ equity. Assets In other words, the accounting equation will always be 8220;in
He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem. When Should I Use the Basic Accounting Equation? Additional numbers starting with six and continuing might be used in large
Analyzing the differences between wages and incomes provides insight into labor market trends, standards of living, and geographic differences in earnings. According to the Bureau of Labor Statistics, wages and salaries accounted for 70% of compensation in 2015, far exceeding the 30% for benefits like health insurance and retirement plans. While benefits have increased over
Internally developed intangible assets are expensed as incurred (R&D costs). Recording depreciation will affect both your income statement and your balance sheet. Recording depreciation is considered an adjusting journal entry, which are the entries that are completed prior to running your adjusted trial balance. Let8217;s say you purchase a large printing press for your publishing
By focusing on accurate revenue projections, effective expense management, and addressing common challenges, hotel managers can create robust budgets that drive profitability. Balancing budgets to accommodate peak and off-peak seasons involves adjusting marketing efforts and staffing levels. Effective planning and resource allocation can help manage seasonal variations. Seasonality can greatly affect hotel revenue, with high occupancy during