EnglishEnglishIf a company decides to become an S-corporation, then it will not need to pay taxes like a C-corp would under the existing codes. Individual shareholders report their earnings on their personal tax returns instead with this option, resulting in a significant amount of tax savings for some companies. It must still operate separately from…
To help you better understand how the accounting equation works, here is a quick example of how the equation can be used. The net income equation, then, shows you how profitable your business’ operations are, but not how healthy your cash flow is. Regardless of how the accounting equation is represented, it is important to…
Content Perform a Self-evaluation of Your Internal Controls What Are the Seven Internal Control Procedures in Accounting? How to Assess an Organization’s Internal Controls Physical Audits of Assets What is an Internal Control Over Accounts Payable? Internal control To achieve these objectives, management must establish an overall internal control system, the concept of which is…
In this form, it is easier to highlight the relationship between shareholder’s equity and debt (liabilities). As you can see, shareholder’s equity is the remainder after liabilities have been subtracted from assets. This is because creditors – parties that lend money such as banks – have the first claim to a company’s assets. To begin…