Cash Dividend

Cash dividend is the distribution of corporate earnings to the stockholders in the form of cash. This is the most usual form of dividends. There are 3 important dates involved with cash dividends. They are: Date of declaration – this is the date the formal...

Accounting for Partnerships

Most of the accounting for partnerships will be identical with that for businesses run by individuals. The chart of accounts can be identical except for drawing and capital accounts for each partner. The main areas of differences in accounting for partnerships is...

Bond

Bond is a written promise by a company, government to pay the face amount at the maturity date. A corporation may seek long term financing through the issuance of bonds. Bonds are similar to notes payable in that the corporation is obligated to repay a stated amount...

Long-Term Liability

Long-term liability is obligation that is payable in money, goods or services for a period in excess of one year. Usually a long-term liability will be reclassified as current near the end of its life. In other cases, the life of the liability may not be clearly...

Warranty

Warranty is an agreement by the seller of services or goods in order to satisfy a stated period of time deficiencies in the item’s quality or performance. A business may have liabilities that, while quite real, can only be estimated. A company which sells...

GoodWill

When a company or part of a company is purchased, it is not uncommon for the purchaser to pay more than the sum of the fair market value for the individual assets minus the liabilities. This excess is called goodwill. It is often attributed to good management, good...