is it true that when one firm sells to anouther on credit, the seller records the transaction as an account receivable while the buyer records it as an account payable and that disregarding discounts, the receivable typically exceeds the payable by the amount of profit on the sale?
205976
Say there is a sale by ABC co. Ltd., to XYZ co. Ltd. on credit  \n\nThe goods costing $5,000 were sold at a profit of $1,000 for $6,000\n\n===================================================\nIn the books of ABC Co. Ltd.,\n===================================================\n\nTransaction :: There is a credit sale for $6,000\n\nAccounting entry\n\nDr. XYZ Co. Ltd. a/c    $6,000\nCr. Sales... ... ... .. $6,000\n\nXYZ Co. Ltd. a/c would be part of Accounts Receivable\n\n===================================================\nIn the books of XYZ Co. Ltd.,\n===================================================\n\nTransaction :: There is a credit purchase of $6,000\n\nAccounting entry\n\nDr. Purchases... ... ...$6,000\nCr. ABC Co. Ltd. a/c    $6,000\n\nABC Co. Ltd. a/c would be part of Accounts Payable\n\nProfit or loss is not taken into consideration for each transaction and is revealed in final accounting..\n\n\nget to this site for help on accounting\n\nhttp://www.futureaccountant.com/accounting-process/
644328
Discount is the rebate that u receive/give over the normal price of a product.\nThere are two types of discounts:\n1. Discount expense that u give to ur customer\n2. Discount income that u receive from seller.\n\nWhen u give discount that u will treat as expense and u make it as debit in accounts\nWhen u receive it u will write it as income and take as credit in books of accounts.\n\nIllustration:\n1.\nPurchases              Dr.\n          Dicsount income (received)                  Cr.\n          Cash/Accounts Payable                       Cr.\n\n2.\n\nCash/ Accounts Receivable        Dr.\nDiscount expense (paid)             Dr.\n              Sales                                             Cr.\n\nSo, u will book ur discount in books of accounts.
8378
I hope to be indecisive, but the correct answer is, "it depends". First, the option itself is an asset and must be disclosed on the form 433-A Collection Information Statement for Individuals, which accompanies all Doubt as to Collectibility Offers. Second, the income from the sale of the option MAY in this case touch off a Future Income Collateral Agreement, which is normally not included in a typical OIC. In fact, in my 13 years in private practice, we have only had 2 cases where the IRS required a Collateral Agreement.\n\nA Future Income Collateral Agreement is used only when the IRS anticipates a large increase in income in the future. This MAY be one of those circumstances. I strongly suggest that your friends consults an EA, CPA or attorney with extensive experience in Offers.
407705
hi, well 'posting' is quite a broad term and I presume you mean 'posting a transaction' or 'posting an entry'. Not trying to sound like your teacher; but 'posting' will depend on each kind of transaction. There are 1) assets, 2) liabilities, 2) equities, 4) revenues and 5) expenses. The 1st three items are reflected in the Balance sheet while the last two in the income statement. Asset and expenses, when increased are DEBIT, when they decrease are CREDIT (DEBIT and CREDIT are two sides of your Journal, the right side is DEBIT and the left side is CREDIT). On the other hand, liabilities, equities and revenues, when increase are CREDIT and when decrease are DEBIT (so they are opposite). eg. If you purchase a car for $10,000, your asset that is your car increases by $10,000 and another asset your cash decreases by $10,000. So car is Debit and cash is Credit, both by $10,000. Similarly you could buy an asset on a loan, so your liability increase which is a Credit and so does your asset which is a Debit. Remember whenever there is a (or more than one) Debit, there is a (or more than one) Credit and both (or all) must be of the same amount so that if Debit is PLUS and Credit MINUS the sum should be ZERO.\n\nFORWARD - well, every month end or year end, you total all your debits and credits in a particular account eg. Cash eg. in August you received $1,000 and at the start of August (or end of July) you had $200 (which means Debit $1,200) and in August you spent $700 (which means Credit $700) then you have a Debit balance of $500. As I said earlier the Journal has two sides for each account. At the end of the month or year every account is closed (as in our example 'cash account' was closed). This is done by balancing the account, eg. in the eg. above the Debit side is $1,200 and Credit is $700, so we will add $500 to the Credit side (this addition to Credit side is called a 'Debit balance' and if it was made to the Debit side it would have been called a 'Credit balance'. This Debit balance (as in our eg. $500) will be forwarded to the next month September. So when you will start the Cash account for September you will drag the 'Debit balance' (which was actually on the Credit side last month to the Debit side in September. It is basically a way to show that what you had at the end of last period you start with the same items (which is quite obvious, wonder why they chose such a tough way of doing it). It must be noted that only Balance sheet items (asset, liabilities and equities) are forwarded. Expenses and revenues are not forwarded they are closed (taken to the income statement).\nHope this helps, cheers.
177914
Pretty good question.  You might consider this as well, if you have a long (inactive) debt on your record, there may be a line item on your credit report from that company as well indicating that you defaulted.  The ammount may not have been worth their effort to try to collect, but that entry on the credit report may also have an effect on your credit score.  On the other side, it may not be worth your effort to pay the back debt and get the company to resolve the credit issue.  On a third side, you should always pay off your debt as soon as possible just because it is the right thing to due.\n\nRomans 13:8 - Let no debt remain outstanding, except the continuing debt to love one another, for he who loves his fellowman has fulfilled the law.
405416
If there was a lawsuit won against the company for damages then the liablity is "Limited" to the assets of the company, not the assets of the owners of that company, that is the main difference, there are also different regulations regarding the reporting of accounts etc.
64866
Typically, yes, but you are correct in that it is ultimately up to the creditor if, when and to whom they send the information.  I've even seen numerous circumstances where collections appear on one bureau but not the other two (the same can be said for judgements, delinquencies, etc).
464839
No.  The other way around.\n\nCredit closing stock $2,200\nDebit an operating expense $2,200 - or accrued receivables if the person drawing down the stocks is going to owe the company.\n\nRemember debiting an asset means MORE of the asset, not less. "Drawings" sounds like a made up liability or expense.  It's an expense if the person doesn't owe it back.  It's a accrued receivable if they owe it back (and it's accrued receivable instead of accounts payable because it isn't invoiced).
204589
There's not a contract as in a signed one, but in this case there is a contract under the UCC.  This is especially true since both the parties are merchants who have a good deal of knowledge on the subject at hand, however since the merchant selling the books made a counter offer (the change in shipping price) the buyer must accept the counter offer for it to become binding.  ie If they don't wish to pay $6/bk for shipping they must not take the books, otherwise they are consenting to the counter-offer.
459436
If it is just transactional, then they don't get any information regarding anything other than what they need to conduct the transaction.\n\nHowever, the poster Steve S. is completely wrong in telling you they don't share your information.\n\nBanks and other finanical institutions have the right to share some of your personal information with other companies.\n\nUnder the Financial Services Modernization Act of 1999 (also known as Gramm Leach Bliley), financial instituions like banks have the right to share your information with other companies UNLESS you specificially tell them not to....in other words, you have to opt out.\n\nSteve's post indicates you have to opt-in and that's just not true.\n\nWhat he is talking about is getting credit information from your credit file, which is governed by a separate law known as the FCRA or Fair Credit Reporting Act....which is an opt-in.\n\nBut applying for credit such as what his post alludes to and using credit to make payments are two very different things in the eyes of the law.\n\nCompanies like eBay can easily buy information about you from any number of data vendors like Choice Point and Axciom, which have very, very detailed dossiers about you and your preferences and your buying habits including your use of credit.
302480
maybe they sent it to your bank .  some companies do that ,  as you will have to sign a credit agreement.
422570
No your contract / agreement is with the original compnay - they have the agreement with the collection agency - if you have paid in full then tell them to go away...if you feel so inclined then you can show them proof but you are not obliged to - refer them back to the original company.
306061
Yes, unfortunately this can happen - although if they're a reputable company it's extremely unlikely.  I know a number of people who have had this happen at hotels, car rental companies, and strangest of all, a restaurant which they visited for a meal, paid by card, then a year later the same amount was debited by the same restaurant on the same date.  I'm sure this particular one was just a glitch, but regrettably there is often a more sinister motive.\n\nHowever, most credit card companies are fairly pro-active in dealing with complaints of this type (at least in the UK).
234986
Income tax Payable is a liability... you increase a liability with a credit. The opposite entry is the income tax expense. You increase expenses with debits.\n\nIncome Tax Expense\n     Income Tax Payable \n\nIf you're talking about income tax due meaning it's a receivable.. its about the exact opposite with another account name. \n\nIncome tax Receivable\n    Retained earnings... (you can't really credit expenses...)
335414
Account maintenance is a cost to the lender even if you do not use the account. Make that especially if you do not use the account, because you are not paying them interest for borrowing money. \nThis part is speculation, but the credit limit they had granted to you might reduce the amount of credit they could offer other potential customers, who might actually borrow from them and pay interest.  \nYes, they can close, or not renew an account when they choose.  It is a business venture for them. they do want to make a profit.  I do not quite agree with the statement that you were "abusing" credit by not using it however.  You simply were not using it the way that benefited them most. From a different perspective, you were being quite responsible with credit by not using a card with the highest interest.
123280
Revenue is $66,000 (52,000 + 14,000)\n\nThe difference is due to the fact that the accrual method recognizes revenue when it is earned (i.e. when the sale is made) rather than when the cash is received.  They received more than their revenues for April because they collected Accounts receivable from prior months.  The difference of 13,000 was already recognized as revenue in a prior month.\n\nSide note, do your own homework - we can't be there for you during your exams.  If you can't do a simple problem like this then I would assume you will not do too well on the exam unless you do it yourself.
400898
Moule is basically correct.\nThe effect of creditting a liabilty account is the same as increasing Creditors.\nIf we are increasing creditors, then we have incurred an expense. However, this might have been a stock purchase, and could therefore be increasing the value of stock.\nIn which case it could be B, as stock is an asset account.