Accounting Questions and Answers

Your net income or net loss equals your total revenues minus your total expenses for an accounting period. If your revenues are greater than expenses, you have net income. If revenues are less than expenses, you have a net loss. example

Net profit or loss = Revenue - total expenses

A trial balance is a bookkeeping or accounting report that lists the balances in each of an organization's general ledger accounts.

A transposition error is a simple error of data entry that occurs when two digits that are either individual or part of a larger sequence of numbers are accidentally reversed (transposed) when posting a transaction.

 A balance sheet is a financial statement that reports a company's assets, liabilities and shareholders' equity at a specific point in time, and provides a basis for computing rates of return and evaluating its capital structure.

How to record the disposal of assets

• No proceeds, fully depreciated. Debit all accumulated depreciation and credit the fixed asset.
• Loss on sale. Debit cash for the amount received, debit all accumulated depreciation, debit the loss on sale of assetaccount, and credit the fixed asset.
• Gain on sale.