So the situation is as the title says. You bought goods from a company that’s now being closed and they haven’t issued an invoice for the goods as of yet regardless of the repeated requests from your part.
The first question you ought to ask yourself is the reason why the company is being winded up. Is it just an inability to pay invoices and the creditors asking for insolvency or is it the owners wanting to close down business with the company otherwise able to pay its debts. Continue reading
Expenses in your business can be of various types (or for various purposes) – cost of goods sold, administrative and other operations related charges, payroll expenses, depreciation of assets etc. Those are the general types of expenses a business can have as a part of their income statement. They support the business in one way or another and are part of generating revenue at the end of the day. Continue reading
It depends. Everything depends, I know, but in a situation like this, the answer depends on why the sale was credited: Continue reading
With selling goods, your “cost of sales” is the expense you made to initially buy the goods. First off they’re in inventory on the balance sheet and as you sell them, they’re taken off from the inventory and shown on the income statement as an expense made to make a sale. Now with services, there are usually no goods. Continue reading
Starting the business always incurs some expenses in itself – registration, analysis, business plans etc. There’re various expenses, which depend on the business, and the situation business is started within however one thing is certain when it comes to accounting for those expenses. Those “start-up” expenses as they are called, are never capitalized as assets, as expenses you’ve made to earn future profits. Continue reading
Expenses are recognized when they’re “made” and not when they’re paid for. Well, unless you’re using cash basis of accounting when all you really do is account for all your transaction just when the money is moving from hand-to-hand. Presuming this is not the case, the other method of accounting, called “accrual basis of accounting” asks you to account for expenses when they’re incurred and not when they’re finally paid for. Continue reading
Normally I would say that bank charges are the easiest to account for and they are not worth to write about. However, truth is that they are and as it seems to me, every day more and more. Continue reading