You can use the nonfarm optional method and report $3,600 (2/3 × $5,400) as your net earnings. The following examples illustrate how to figure net earnings when gross nonfarm income is $9,840 or less. If you meet the three tests explained earlier, use the following table to figure your nonfarm net earnings from self-employment under […]
Category Archives: Bookkeeping
They are affected by various factors, such as price discrimination, externalities, information asymmetry, and transaction costs. Here’s a hypothetical example to show how this works using the price of oil. If production costs per unit cost of production formula varied between $20 and $50 per barrel, then a cash-negative situation would occur for producers with […]
Revenue is recorded when it is earned (when a bill is sent), not when it actually arrives (when the bill is paid). Accrual accounting recognizes the impact of a transaction over a period of time. The most notable principles include the revenue recognition principle, matching principle, materiality principle, and consistency principle. Completeness is ensured by […]
One special journal will record cash receipts, and another will record cash payments. When you sell something to a customer who pays in cash, debit your Cash account and credit your Revenue account. Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for […]
