Category: Accounting

  At EcomBalance, we are very familiar with Form 1096. That’s because this is the form that you need to use when you hire freelancers. Freelancers are part of the category of contractor. This means anyone you hire who is not an employee.   Form 1096 goes along with Forms 1099-NEC or 1099-MISC, which you… Continue reading What is Form 1096? Explanation & Examples

  Introduction   Journal entries act as the building blocks of financial accounting, providing a chronological record of all transactions made by a business. They enable companies to keep track of all financial transactions and ensure that the accounts are balanced.   Whether you’re a seasoned accountant or a small business owner acquiring accounting acumen,… Continue reading Journal Entry Examples (Easy-to-Understand)

  When examining a company’s balance sheet, you may encounter a somewhat enigmatic item known as “goodwill.” This intangible asset can significantly influence a company’s financial health. In this comprehensive guide, we’ll delve into the intricacies of goodwill on a balance sheet, exploring its definition, various types, calculation methods, implications, and tax treatment.   What… Continue reading What is Goodwill on a Balance Sheet? Definition & Examples

  In today’s rapidly evolving commerce landscape, Direct to Consumer (DTC) business models have emerged as a disruptive force, reshaping how businesses connect with their customers. While the digital age has made it easier for brands to reach out directly to their consumers, it has also brought unique challenges in terms of accounting and bookkeeping.… Continue reading Direct to Consumer (DTC) Accounting & Bookkeeping Basics, Tips, & Tools

  The U.S. tax code is notoriously complex, but for business owners and entrepreneurs, it offers various deductions and credits to help reduce their tax liability. One such deduction is the Qualified Business Income Deduction (QBI). In this article, we’ll explore the ins and outs of the QBI deduction, including who qualifies for it, the… Continue reading What is the Qualified Business Income Deduction (QBI) and How Does It Work?

  Retained earnings on a balance sheet represent the cumulative amount of net income that a company has kept, rather than distributed to its shareholders in the form of dividends. Essentially, it’s the portion of net profits not paid out as dividends but instead reinvested in the core business or kept for future use. Located… Continue reading What is Retained Earnings on a Balance Sheet? W/ Examples

  What are debits vs credits? How do they relate to each other and why are they important?  You may not be an accountant or a bookkeeper, but it’s important to know these terms. As a business owner, this is how you know what money is coming in and what money is going out of… Continue reading Debits vs Credits: A Guide with Examples & How To’s

  How do I calculate my bottom line using the net income equation?    In this post, we’re talking all things net income and how to calculate it. We’ll go through factors affecting your net earning and what you can do to mitigate them.    What is Net Income?   Net income, also popularly known… Continue reading Net Income Equation | How to Calculate the Formula w/ Examples

  What is a fractional bookkeeper and how can I benefit from hiring one?    Below we’ll talk about this versatile solution and what duties these bookkeepers can perform. Later on, we’ll also share some advice for looking for and working with these people.    What is a Fractional Bookkeeper?   As the name suggests,… Continue reading What Is a Fractional Bookkeeper? Definition & Examples