Is accounts receivable an asset or revenue? Some businesses sell goods or services to their customers on credit. That is, these businesses deliver the goods and services immediately, send an invoice to their customers, and then get paid a few weeks later. In order to keep track of all the … Read more
Is purchase debit or credit? Purchase is an expense that is included on the income statement within the cost of goods sold if it is incurred for purchasing raw materials that are used in the manufacturing process. Every company that is in existence has had reasons for purchasing equipment, inventory, … Read more
Is depreciation expense debit or credit? When companies purchase assets for their business, they try to consider how long these assets would keep their value and how to account for their expense. A depreciation expense is usually recorded for fixed assets and is the cost of the asset over time. … Read more
Is accounts receivable a current asset? Some customers or clients can purchase goods or services from businesses on credit. On such occasions whereby sales are made on credit, the business records the amount that the customer owes the business as accounts receivable. This account on the business’s balance sheet shows … Read more
Are expenses liabilities? Expenses and liabilities both represent a cash outflow that is either incurred in the current period as an expense or to be settled on a future date in the case of a liability. Expenses and liabilities represent two distinct components in a company’s financial statements. In this … Read more
Is utilities expense debit or credit? Usually, businesses (as well as individuals), incur costs when they make use of things like electricity, water, etc., as these items are useful. For instance, a manufacturing firm or a cyber cafe cannot operate without a power supply, or a restaurant owner cannot operate … Read more
Is merchandise inventory debit or credit? Merchandise inventory is goods that have been purchased by a retailer, wholesaler, or distributor from suppliers, with the intention of selling the goods to third parties. For some types of businesses, merchandise inventory can be the single largest asset on the balance sheet. When … Read more
Is rent expense debit or credit? Although recent advancements in technology have led to a lot of businesses adopting remote work options, most businesses still have a physical location that is used as an office. Due to the high cost of real estate, most of these companies do not own … Read more
Is salaries expense debit or credit? Salaries expense is normally recorded in a company’s income statement as part of the cost of goods sold or indirect cost. The portion of salaries expense that was directly spent on the production of goods or services is listed as part of the cost … Read more
Is deferred service revenue debit or credit? Any time a company or individual receives payment for future services, this is called unearned service revenue. It might also be recorded as deferred service revenue. Unearned revenue is the money that a business receives in advance for a good or service. In … Read more
