Accounting has a basic function

Accounting has a basic function Cabinet Comptable Angers

Accounting has a basic function “to facilitate the administration of economic activity,” as University of Michigan accounting professor William Paton puts it. This function has two closely related phases: 1) measuring and collating economic data, and 2) communicate the results of this process to interested parties. “

For example, the accountants of a company

periodically measure the result of a month, quarter, or year and publish those results in a statement of profit and loss called the statement of operations, says Carte codes postaux . These statements include items such as accounts receivable (what is owed to the business) and accounts payable (what the business owes). It can also get quite complicated with topics like retained earnings and accelerated depreciation. This at senior levels of accounting and within the organization.

However, much of the bookkeeping is also about basic bookkeeping. This is the process that records every transaction; every bill paid, every penny due, every euro and cent spent and accumulated.

But the owners of the business,

who may be individual owners or millions of shareholders, are most affected by the summaries of these transactions, contained in the financial state. Financial statements summarize the assets of a business. The value of an asset is what it cost when it was first acquired. Financial statements also record the sources of assets. Some assets take the form of loans that must be repaid. Profits are also an asset for the company.

In what is called double-entry bookkeeping, the liabilities are also brought together. Obviously, a business wants to display a higher amount of assets to offset liabilities and make a profit. Managing these two elements is the essence of accounting.

There is a unique system for doing all of this; not every business or individual can design their own accounting system; the result would be chaos!

This article “Accounting has a basic function” was courtesy of Expert Comptable Angers


Automobile Tax Expenses

Automobile Tax Expenses ExpertComptable-Toulon.comAutomobile Tax Expenses : if you use a vehicle for conducting business, you can deduct certain automobile tax expenses from your tax bill. This is true even if you use the vehicle for personal and business needs.

Automobile Tax Expenses

The powers that be have historically written sections into the tax code promoting business activities. One of the traditional write-offs has always been the expenses associated with using a vehicle for business purposes.

The simplest automobile tax expense situation is one in which a vehicle is used entirely for business. For example, if you have a van used for a delivery service and nothing personal, all expenses associated with the van can be written off. This is known as the exclusive use situation. For many small businesses, however, a vehicle will be used for both personal and business reasons.

Where you use a vehicle for both personal and business reasons,

you can only deduct the automobile expenses associated with the business use. Keep in mind that driving to and from work is not considered business mileage while driving from an office to meet a client is considered business mileage.

There are two methods for determining deductible automobile tax expenses. The first is a simple calculation known as the standard mileage deduction. The second is the actual expenses method. You can choose whichever deduction provides you with the biggest deduction unless you lease the car. With a lease, you must use the standard mileage deduction.

The standard mileage rate deduction is a calculation wherein you multiply your total business mileage for the year by a figure provided by the IRS. For the first eight months of 2005, the figure provided by the IRS is 40.5 cents per mile, says Vin Faugeres . For the last four months of 2005, the figure has been bumped up to 48.5 cents to reflect high gas prices.

The actual cost expense option is exactly what it sounds like.

It is the actual cost associated with using the vehicle for tax purposes for a particular tax year. Automobile tax expenses will include gas, tires, repairs, oil changes, registration costs, licensing, insurance and so on. In many cases, the actual expense deduction will end up being larger than the standard mileage deduction.

Regardless of the method you choose, you must document the automobile tax expenses. This means keeping a mileage book and receipts of anything you intend to deduct.

This post “Automobile Tax Expenses” was kindly provided by Cabinet Comptable Toulon