![]() Bookkeeping requires an entry to account for these values. Therefore, the accountant must estimate the costs and any revenue associated with the item. Accrual accounting requires the matching of revenue and costs associated with this event in the accounting period the item or event occurs. When these unusual events happen the actual costs are often unknown as it takes several weeks to realize. * Write-Down of Assets Notably Goodwill Research and Development * Sale of a Department, Division or an Entire Segment of a Company * Work Stoppage (Labor Strike, Civil Unrest, Community Events) * Losses Associated with Natural Disasters Basically, they rarely occur but do happen once or twice over an economic cycle. The final type of estimating relates to unusual and infrequent items these are commonly referred to as extraordinary items. Bookkeeping – Estimating Extraordinary Items (Lesson 87) ![]()
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