Nominal Account In accounting, a nominal account is a general ledger account that is use to record revenues, expenses, gains, and losses for a specific accounting period. These accounts are also known as income statement accounts or temporary accounts. Because their balances are reset to zero at the end of each accounting period, typically a… Read More »
The functions of the accounts receivable The functions of accounts receivable in accounting are as follows: 1.Recording Sales: Accounts receivable records the amount of money owed to a business by customers for goods or services sold on credit. It serves as a record of credit-based sales made by the business. 2.Payment Tracking: Accounts receivable tracks… Read More »
Why are prepaid expenses considered an asset? Why are Prepaid expenses considered an asset, Prepaid Expenses are consider an asset because they represent a payment made by a company for goods or services that will be receive in the future. Even though the expense has been paid upfront. It has not yet been incur.… Read More »
How are Sundry expenses treated in a balance sheet Sundry expenses are generally treated as an expense in the income statement of a business and are deducted from the revenue earned to arrive at the net income or profit for the period. They do not appear as a separate item in the balance sheet. But… Read More »