Edspira
Edspira
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Accounting for Transaction Processing Fees
When a company accepts payment by credit card, the company incurs a transaction processing fee from a payment processing network (Visa, MasterCard, etc.). Thus, if a customer makes a $100 purchase, the company won't receive the full $100 due to the transaction processing fee.
Transaction processing fees (aka credit card fees or payment processing fees) are an operating expense and not a reduction of sales revenue. Thus, if a company accepts a credit card as payment for a $100 purchase, and the company is charged a transaction processing fee of 3%, the company would increase its cash account by $97, record a $3 expense, and record $100 of sales revenue.
Some companies apply a surcharge to transactions in which the customer pays with a credit card (to recoup the cost of the payment processing fees). If a company does assess a surcharge, this would increase the amount of cash received by the company (since it is collecting the surcharge) and increase the company's revenue.
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Edspira is the creation of Michael McLaughlin, an award-winning professor who went from teenage homelessness to a PhD. Edspira’s mission is to make a high-quality business education freely available to the world.
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Переглядів: 478

Відео

Where to Find Dividends in the Financial Statements
Переглядів 526День тому
When a company issues dividends, where will the dividends appear in the company's financial statements? -Dividends DECLARED will appear in the statement of stockholders' equity, because this statement shows changes in stockholders' equity accounts and dividends declared reduce retained earnings, which is a stockholders' equity account -Dividends PAID will appear as a cash outflow in the financi...
Journal Entry for Loan
Переглядів 82521 день тому
When a company borrows money by taking out a loan, the borrower debits the cash account (an asset) and credits either loan payable or note payable (a liability). The lender would debit loan receivable and credit the cash account. When interest is accrued on the loan, the borrower must record interest expense and credit interest payable (or credit the cash account if the interest is paid immedia...
When you get Dividends from Stocks
Переглядів 616Місяць тому
There are multiple dates involved with dividends: the declaration date, the ex-dividend date, the record date, and the payment date. So when do you need to own the shares to be entitled to a dividend? And when do you actually receive the dividend? To be entitled to a dividend, you must own the shares when the markets close the business day BEFORE the ex-dividend date. The ex-dividend date is th...
How to Value Dividend Stocks
Переглядів 718Місяць тому
Companies that have a long history of paying dividends can be valued using dividends-based valuation. The dividend discount model (DDM) estimates the intrinsic value of a company's common equity as the sum of all future dividends, discounted to their present value. The resulting figure is then divided by the number of common shares outstanding to obtain the estimated value of the company's comm...
Interest Received Journal Entry
Переглядів 949Місяць тому
A company might receive interest from making a loan, purchasing an interest-bearing investment, or from having an interest-bearing bank account. In each situation, the company must (1) record interest revenue when interest is earned and (2) increase the cash account when interest is received. If the interest is earned and cash is received at the same time, then the company can simply debit the ...
Journal Entry for Late Payment Fees
Переглядів 675Місяць тому
What happens when a company incurs a late payment fee for failing to pay a bill on time? It depends on the situation. For example, let's say a company purchased $100 of inventory on credit, and the company debited its Inventory account for $100 and credited Accounts Payable for $100 when it received the inventory. Later, if the company fails to pay its bill on time and incurs a late payment cha...
How to Reverse Engineer a Company's Share Price
Переглядів 1,3 тис.Місяць тому
This video shows how to reverse engineer a company's share price using "Goal Seek" in Microsoft Excel. To "reverse engineer" a company's share price means to back out assumptions made by investors about the company's forecasted cash flows, growth rate, or cost of capital. For example, let's assume that you estimate the intrinsic per-share value of a company's equity using the Gordon Growth Mode...
Journal Entry to Record Cash Collected from a Customer
Переглядів 8942 місяці тому
This video shows the journal entry to record cash collected from customers in 3 different situations: (1) when a cash is made (cash is collected immediately when the sale is made) (2) when a credit sale is made (cash is collected at a later point in time) (3) when unearned revenue is recorded (cash is received, but revenue is not recorded) The journal entries for cash sales and credit sales are...
Journal Entry for Purchase of Inventory | Perpetual Inventory System
Переглядів 1,1 тис.2 місяці тому
This video shows how to record the journal entry for inventory purchases when inventory is purchased on account (a credit purchase) and when inventory is purchased for cash (a cash purchase). In both cases the inventory account is debited when inventory is acquired, but "Accounts Payable" is credited for purchases on account whereas "Cash" is credited when the inventory is immediately paid for ...
Return on Equity vs Return on Assets
Переглядів 1,6 тис.3 місяці тому
Return on assets (ROA) tells you how good a job a company did generating profit given the amount of assets it had, whereas return on equity (ROE) tells you how good a job a company did generating profit given the capital put up by equity holders to finance the firm. ROA and ROE are related in that ROE is equal to ROA times financial leverage. You can see this relationship between ROA and ROE by...
Net Operating Profit After Taxes
Переглядів 8713 місяці тому
Net operating profit after taxes (NOPAT) tells you a company's profit assume the company had zero debt. NOPAT is also called unlevered net income, tax-effected EBIT, and EBIAT (earnings before interest after taxes). NOPAT is helpful because it allows you to compare the core operating profit after taxes for two companies independent of their financing structure. Unlike net income, NOPAT isn't af...
Edspira Update - 2024
Переглядів 1 тис.3 місяці тому
This is a quick update on me and my channel for 2024. - Edspira is the creation of Michael McLaughlin, an award-winning professor who went from teenage homelessness to a PhD. Edspira’s mission is to make a high-quality business education freely available to the world. - SUBSCRIBE FOR A FREE 53-PAGE GUIDE TO THE FINANCIAL STATEMENTS, PLUS: • A 23-PAGE GUIDE TO MANAGERIAL ACCOUNTING • A 44-PAGE G...
ROE vs. ROCE
Переглядів 1,3 тис.3 місяці тому
This video discusses the difference in calculating ROE (return on equity) versus ROCE (return on common equity). Note that ROE (return on equity) is net income for the WHOLE company divided by average stockholders’ equity, with the latter including all sources of equity (common equity, preferred equity, equity of noncontrolling interests). ROCE (return on common equity), on the other hand, is n...
Career Prospects for Accounting Students
Переглядів 2,4 тис.4 місяці тому
Are you considering a career in accounting? This video tackles the burning question: does accounting have a good future? We delve into the high demand for accountants in the US, exploring reasons for the current shortage: Burnout from long hours in public accounting, pushing professionals to greener pastures. Attractive salaries in finance and tech luring college graduates away from accounting ...
How to Account for Restricted Stock Award
Переглядів 9654 місяці тому
How to Account for Restricted Stock Award
Accounting for Employee Share Purchase Plans
Переглядів 1,1 тис.5 місяців тому
Accounting for Employee Share Purchase Plans
Diluted Earnings Per Share | Convertible Preferred Shares
Переглядів 1,9 тис.5 місяців тому
Diluted Earnings Per Share | Convertible Preferred Shares
How to Account for Stock Retirement
Переглядів 1,2 тис.6 місяців тому
How to Account for Stock Retirement
Postretirement Benefit Expense | Journal Entry
Переглядів 6326 місяців тому
Postretirement Benefit Expense | Journal Entry
How to Measure a Company's Postretirement Healthcare Benefit Obligation
Переглядів 7026 місяців тому
How to Measure a Company's Postretirement Healthcare Benefit Obligation
Accounting for Pensions vs. Other Postretirement Benefits
Переглядів 1 тис.7 місяців тому
Accounting for Pensions vs. Other Postretirement Benefits
Fair Value Option for Bonds Payable
Переглядів 1,4 тис.7 місяців тому
Fair Value Option for Bonds Payable
What to Do with Accounting Degree
Переглядів 7 тис.7 місяців тому
What to Do with Accounting Degree
How to Account for Early Retirement of Bonds
Переглядів 3,1 тис.7 місяців тому
How to Account for Early Retirement of Bonds
How to Account for Bonds Issued between Interest Dates
Переглядів 2,5 тис.7 місяців тому
How to Account for Bonds Issued between Interest Dates
How to Account for an Installment Note
Переглядів 1,4 тис.8 місяців тому
How to Account for an Installment Note
How to Account for an Extended Warranty
Переглядів 1,6 тис.8 місяців тому
How to Account for an Extended Warranty
Warranty Liability | Expected Cash Flow Approach
Переглядів 1,5 тис.8 місяців тому
Warranty Liability | Expected Cash Flow Approach
S Corporation Indebtedness and Shareholder Basis
Переглядів 1,3 тис.8 місяців тому
S Corporation Indebtedness and Shareholder Basis

КОМЕНТАРІ

  • @abdulmohsenbader7360
    @abdulmohsenbader7360 42 хвилини тому

    Thanks Nick valentine

  • @pierre9620
    @pierre9620 Годину тому

    I love this guy

  • @andy_182
    @andy_182 10 годин тому

    Ridiculous that business calculus is required for my school

  • @Shovttt7
    @Shovttt7 15 годин тому

    I'm getting 3.717098403 as the discount factor

  • @ariah5093
    @ariah5093 21 годину тому

    Puppetry majors rn: 👀

  • @zakariabouras3683
    @zakariabouras3683 День тому

    I’m really struggling studying finance, I hope u could help me, I’m probably about to retake again the year and I’m stuck I cannot get through it

  • @thomasjoseph2252
    @thomasjoseph2252 День тому

    I hope the salvage value has to be deducted in the beginning.

  • @nicksmith5269
    @nicksmith5269 День тому

    amazing, thank you

  • @samkab677
    @samkab677 День тому

    What is the journal entries for these?

  • @salamance2
    @salamance2 День тому

    What if the company sees a growth of APIC due to market reevaluation ? During the retirement of the 20,000 shares would that also be 100,000 debited APIC ?

  • @popcorn101cheese5
    @popcorn101cheese5 День тому

    Hi, I am a little confused, shouldn’t the entry for the issuance be; debit cash 100,000, credit B/P 92,269, credit share premium-conversion equity 7,731?

  • @thomasjoseph2252
    @thomasjoseph2252 День тому

    Well explained

  • @lostheroes8704
    @lostheroes8704 2 дні тому

    what happens let's say if my impairment loss is 65000 and my goodwill is 90,000. and I have other assets in my balance sheet as well. how do I allocate my impairment loss

  • @kkarimpie
    @kkarimpie 2 дні тому

    thanks laddy, amazing video. Don't even do accounting and this helped me pass

  • @EliasMehari
    @EliasMehari 2 дні тому

    What is pv and v

  • @JalenBooekr
    @JalenBooekr 3 дні тому

    Trying to build your income and prepare for retirement? It’s important to choose stocks that are expected to hold up in inflationary environments. To combat the negative effect of inflation, it’s a good idea to diversify your portfolio across different asset classes, such as stocks, bonds, and real estate, since this can help protect your portfolio against inflation. I have seen People making up to $500k in a month during high inflation.

    • @tahirisaid2693
      @tahirisaid2693 3 дні тому

      Recognizing that you need professional assistance is a significant step in the right direction. For beginners, the most beneficial action to take in this field is to enlist the guidance of a financial advisor. This approach allows you to both earn money and gain valuable insights into the industry.

    • @tahirisaid2693
      @tahirisaid2693 3 дні тому

      Angela Lynn Schilling is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

  • @JalenBooekr
    @JalenBooekr 3 дні тому

    Trying to build your income and prepare for retirement? It’s important to choose stocks that are expected to hold up in inflationary environments. To combat the negative effect of inflation, it’s a good idea to diversify your portfolio across different asset classes, such as stocks, bonds, and real estate, since this can help protect your portfolio against inflation. I have seen People making up to $500k in a month during high inflation.

    • @tahirisaid2693
      @tahirisaid2693 3 дні тому

      Recognizing that you need professional assistance is a significant step in the right direction. For beginners, the most beneficial action to take in this field is to enlist the guidance of a financial advisor. This approach allows you to both earn money and gain valuable insights into the industry.

    • @tahirisaid2693
      @tahirisaid2693 3 дні тому

      Angela Lynn Schilling is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

  • @user-qm9nh3js5l
    @user-qm9nh3js5l 3 дні тому

    Greatest vedio

  • @adelene5983
    @adelene5983 3 дні тому

    OMG, thank you soooo much!!! Your explanation is way clearer than any other videos I've watched. You're my lifesaver!😭🙏

  • @yomnarizvi1992
    @yomnarizvi1992 3 дні тому

    Thanks a lot for your videos :)

  • @donsergio2406
    @donsergio2406 3 дні тому

    The explanation is incomplete: how about all the IRS exceptions to the QBI? It's not 20% write off across the board. The nature of the business may not qualify for it.

  • @juanjosemartinez6483
    @juanjosemartinez6483 3 дні тому

    What a great explanation, thank you my friend

  • @floralscraftanddiys
    @floralscraftanddiys 3 дні тому

    After 10 year, ifund this valuable 😮the real reason i like UA-cam 😊

  • @ChenMinTCM
    @ChenMinTCM 3 дні тому

    Good explanation…better than college lecturer! ❤

  • @Mastashredda7
    @Mastashredda7 3 дні тому

    Makes sense, thanks Ed

  • @ontarioreignfan
    @ontarioreignfan 4 дні тому

    In your example why would sales revenue be $103 instead of $100? The additional $3 is an administrative fee/processing fee and is only charged if paying by credit card and would not be charged if customer paid by cash. The sale of the product/service should be $100 regardless of the method of payment. Plus by including the $3 in the sales revenue wouldn’t that skew your gross margin? My take would be that there would no merchant fee expense since the $3 charged by the credit card company is being passed onto and paid by the customer. So ultimately there is no $3 fee incurred by the company. It’s a wash. I believe the journal entry is incorrect as well. Should be: Cash 103 Merchant Fee Expense 3 Sales Revenue 100 Then when the company pays the $3 credit card fee the JE entry would be: Merchant Fee Expense 3 Cash 3 Therefore a wash. In your JE you represent that the company is receiving $100 when they are actually receiving $103 ($100 product/service sale + $3 credit card charge).

    • @Edspira
      @Edspira 4 дні тому

      I see the logic of what you are saying, and both our approaches arrive at the same net income. My main issue with your approach is that it appears as if the company didn't incur any merchant fee expense, when the company did in fact incur this expense; the company just increased the price it charged to the customer to cover the expense. The surcharge can be viewed as a way to charge different prices to different customers based on whether they pay with a credit card; thus, if a customer chooses to pay with a credit card, the company charges them a higher price and thus records higher sales revenue. Now if the company's accountant thinks it would be more helpful to record the surcharge as "other revenue" and not sales revenue, I agree that this could be helpful in terms of tracking the revenue generated by the surcharge (and it would also address your point about the effect on the gross margin). But based on my research of the ASC in the U.S. the FASB a clear accounting treatment for this situation (this might be different outside the U.S.).

    • @ontarioreignfan
      @ontarioreignfan 4 дні тому

      @@Edspira So if I took the approach that I outlined in my initial reply would that be considered a departure from GAAP? So if I did it the way that I’m thinking an outside auditor would more than likely reclass my entries to the way you’re suggesting?

    • @Edspira
      @Edspira 3 дні тому

      Based on my research there isn't a clear position of U.S. GAAP on how this situation should be treated. Thus, I think there is room for diversity in practice. I can't say how an outside auditor would react to your position and I'm not saying you are wrong. I'm just saying the ASC doesn't clearly outline how to account for this scenario (based on the research I've conducted - feel free to cite authoritative literature showing otherwise) and that in my opinion it would be helpful to see that an expense was incurred and that revenue was generated (thereby offsetting each other).

    • @ontarioreignfan
      @ontarioreignfan 3 дні тому

      @@Edspira Thank you for responding. Very much appreciate your insight.

  • @hanihasan2343
    @hanihasan2343 4 дні тому

    How did you assume the inflows ?

  • @liyabonangcizela2086
    @liyabonangcizela2086 5 днів тому

    great stuff

  • @user-ki8eo2yy4v
    @user-ki8eo2yy4v 5 днів тому

    Terima kasih materinya.

  • @eebisafekadu5487
    @eebisafekadu5487 5 днів тому

    do it

  • @eebisafekadu5487
    @eebisafekadu5487 5 днів тому

    4. The Harro Card Company, a producer of specialty cards, has asked you to complete several calculations based upon the following information: Income tax rate 30% Selling price per unit Br 6.60 Variable cost per unit Br 5.28 Total fixed costs Br 46,200.00 Required: A. What is the breakeven point in cards? B. What sales volume is needed to earn an after-tax net income of Br 13,028.40? C. How many cards must be sold to earn an after-tax net income of Br 18,480? 5. Lensa Corporation has the following budgeted sales for the next six-month period: Month Unit Sales

  • @surilmehta9127
    @surilmehta9127 5 днів тому

    This, and the series, is extremely useful!! Thanks a lot for these videos!!

  • @CPAHallTalk
    @CPAHallTalk 6 днів тому

    Very well done!

  • @Kaysha-ir4lk
    @Kaysha-ir4lk 6 днів тому

    I've just found your channel. I shall be watching many more of your videos. Thank you!

  • @JoanitoLeroux
    @JoanitoLeroux 7 днів тому

    Manz ar li bro❤

  • @premlatasingh3431
    @premlatasingh3431 7 днів тому

    I was looking for example to understand it better. Thank you so much, I am able to understand it now!

  • @mortenenriquez1570
    @mortenenriquez1570 7 днів тому

    Passing the CPA exams is when you study hard, if you can't study or you don't have time for your studies I'd advise you get yourself a help like Mr Willard.

    • @MarylandGiles
      @MarylandGiles 7 днів тому

      People keep talking about Willard all over UA-cam, he must be a very awesome help.

    • @HerbertThompson-zc6rd
      @HerbertThompson-zc6rd 7 днів тому

      Yes you're correct but remember heaven helps those who help themselves, try studying if you can't study then get yourself a good help

    • @janetclairec3017
      @janetclairec3017 7 днів тому

      I studied for months and couldn't pass, I guess passing is a blessing

    • @MarkClinton-mp8ex
      @MarkClinton-mp8ex 7 днів тому

      I studied for months and couldn't pass, I guess passing is a blessing

    • @PhilipsGreek
      @PhilipsGreek 7 днів тому

      Everyone has their own way, Willard worked for me and studying didn't .

  • @robertenriquez8235
    @robertenriquez8235 7 днів тому

    Passing the CPA exams is when you study hard,if you can't study or you don't have time for your studies I'd advise you get yourself a help like Mr Dylan

    • @jaxenriquez
      @jaxenriquez 7 днів тому

      People keep talking about Dylan all over UA-cam,he must be a very awesome help

    • @noramei-hua9577
      @noramei-hua9577 7 днів тому

      Yes you're correct but remember heaven helps those who help themselves, try studying if you can't study then get yourself a good help

    • @AnthonyBoltman-um9jl
      @AnthonyBoltman-um9jl 7 днів тому

      I studied for months and couldn't pass, I guess passing is a blessing

    • @OliviaAvarado
      @OliviaAvarado 7 днів тому

      CPA exam might seem so tough to pass but studying very hard is a very vital skill to win trust me.

    • @HendersonJoshua-km9ux
      @HendersonJoshua-km9ux 7 днів тому

      Everyone has their own way, Dylan worked for me and studying didn't .

  • @jonnyboi7087
    @jonnyboi7087 7 днів тому

    super helpful thank u!

  • @ajaykumargoel9398
    @ajaykumargoel9398 8 днів тому

    Thank you so much, what an excellent explanation!

  • @mimiesdiaries
    @mimiesdiaries 8 днів тому

    You nailed this

  • @AlexandraCMagana
    @AlexandraCMagana 9 днів тому

    I was so scared for my mid-term tomorrow because this is by far the hardest chapter I've learned. You helped me understand it sooo much better!

  • @benshwartzman6922
    @benshwartzman6922 10 днів тому

    i feel like your videos leave me with more questions than they answer, but its ok

  • @aimua2243
    @aimua2243 11 днів тому

    Love you

  • @Sushil_by_name_only.
    @Sushil_by_name_only. 11 днів тому

    🙏

  • @rainbowsunshine-oc3bs
    @rainbowsunshine-oc3bs 12 днів тому

    bro you lost me as soon as you skipped over what convertible vs callable was, and then again when you jumped into participating and started using sloppy abbreviations. which is weird because all of your other videos have been pretty awesome up to this point

  • @user-fz3bo4zs4n
    @user-fz3bo4zs4n 12 днів тому

    Sounds like all businesses are filing bankruptcy! Not many will score above 3

  • @DanielSavakus
    @DanielSavakus 12 днів тому

    Why would the creditor accept payment less than the carrying value?

  • @ufobuss1317
    @ufobuss1317 12 днів тому

    So what if there’s a beginning inv do I just use that as first out instead of first purchase

  • @TildahNenge
    @TildahNenge 12 днів тому

    understandable