Eric Gerard Ruiz, CPA

Brex Empower is a platform that lets Brex users request cards and spending limits, pay vendors, and issue reimbursements to employees. This platform comes with every Brex Business Account, free of charge. Our Brex Empower review will focus only on its features as a spend and expense management tool. For information about the provider’s accounts,…

The accounts receivable (A/R) turnover ratio is helpful in managing your A/R and measures how effectively a business collects payment from customers they have extended credit to within a given period―generally one year. Analyzing the A/R turnover should include industry benchmarks to give you a full understanding of whether the company is doing fine at…

Product and period costs are the two major classifications of costs that have different accounting treatments. Product costs are related to the cost of purchasing inventory for sale or performing a service. Meanwhile, period costs are costs that are not related to production but are essential to the business as a whole. It’s important to…

Direct costs are traceable to a specific product or business component, while indirect costs benefit multiple products or the business in general. Knowing the difference between direct vs indirect costs helps in understanding the business’s cost structure and developing a competitive pricing strategy. Moreover, understanding the nature of costs enables you to determine if all…

Creating a business budget is an important step in planning. A small business budget starts with creating the budgeting process, the operating budgets, such as sales, inventory and purchases, cost of goods sold (COGS), and sales and administrative, and ends with the financial budgets, such as cash, capital, and proforma financial statements. To help you…

Small business owners can avoid frequent inventory counts and save time by using the gross profit method to estimate inventory. The gross profit method is the easiest inventory estimation technique wherein the company uses historical gross profit rates to determine cost of goods sold (COGS) and estimate ending inventory. By assuming a constant gross profit…

The double declining balance (DDB) method (also called 200% declining balance method or 200DB) computes higher depreciation expense in the earlier years and then declines as it goes nearer the end of the useful life. It is called “double declining” because the depreciation rate is twice the straight-line rate. The double declining balance method formula…

Days payable outstanding (DPO) measures the average number of days from when a company purchases inventory and materials from the supplier until it’s paid. The DPO calculation is: DPO = Number of Days x = Average Accounts Payable  Cost of Goods Sold The formula can easily be changed for periods other than one year or…

We’ll provide you with 10 vendor onboarding best practices—from creating an onboarding plan and discussing business processes to sorting out required documents and documenting payment methods—that can help you design a smooth and productive onboarding process. We also have a free vendor onboarding checklist, as well as templates for vendor registration, credit card acceptance, and…

We present 12 invoice examples that can inspire you to create a unique invoice to communicate with your customers clearly while further promoting your company. Having a well-designed invoice is an accounts receivable best practice that will encourage customers to pay on time. Besides being a request for payment, invoices can serve as promotional material…

Segregation of duties (SoD) in accounting is defined as developing a system where no person is performing tasks within more than one of three general functions. It’s an internal control mechanism that prevents fraud and error, and proper SoD ensures checks and balances within the business. When there is no SoD in place, opportunities to…

The average cost method computes inventory cost based on total cost of purchases divided by the number of goods purchased. Since AVCO uses an average cost of goods in inventory, rather than tracking individual units, it’s simpler to use than first-in, first-out (FIFO) or last-in, first-out (LIFO). The main highlight of the average cost method…