Eric Gerard Ruiz, CPA

If you’re seeing unapplied cash payment income in QuickBooks Online, it means a customer payment was recorded, but QuickBooks doesn’t recognize it as linked to an invoice. This usually happens when the payment date is earlier than the invoice date or if a payment was entered without being correctly applied. It can also occur if…

What is payroll accounting? Payroll accounting is the process of managing, recording, and reporting all aspects of payroll transactions. This includes paychecks distributed to employees, deductions and taxes withheld from employee paychecks, and the employer’s share of benefit contributions and taxes. Accounting for payroll is fundamentally straightforward — you log all employee compensation expenses, record…

There is no definitive way or mathematical model to solve how to calculate the useful life of an asset, as the calculation varies depending on whether you follow IRS tax regulations or GAAP guidelines. As such, I’ll go over how to determine the useful life of an asset for two purposes: tax depreciation and financial…

The prime cost is the total direct material and labor costs of producing a product or delivering a service. It helps you analyze how much these costs reduce your gross profit, making it easier to determine whether your expenses are within a healthy range. The formula for computing prime costs is as follows: Prime cost…

The main differences between Xero vs QuickBooks lie in features and pricing. Xero is more affordable than QuickBooks Online, always includes unlimited users, and offers inventory management and fixed asset accounting in all its plans. QuickBooks, on the other hand, has generally more developed features, such as bank reconciliation without bank feeds, integrated electronic bill…

Zoho Books and Xero are both solid accounting software, but in my evaluation, Zoho Books comes out on top for its advanced inventory management and flexible pricing. That said, I’d recommend Xero for businesses with large accounting teams that need unlimited users and easy scalability. Zoho Books: Small businesses looking for a full-featured accounting program with…

Designed by well-known criminologist Donald R. Cressey, the fraud triangle explains the reasons behind fraud and is a guide for small business owners and managers to assess the areas where fraud might exist. In the accounting process, we look at fraud as a causative factor for material misstatements in accounting records and financial statements. We…

Small business owners can save significantly by preparing their own returns instead of paying a CPA’s typical $500-plus minimum. I recommend using one of the best small business tax software options, which makes filing faster and more manageable with intuitive platforms, knowledgeable customer support, and tools like tax calculators, accuracy guarantees, deduction maximizers, and mobile…

In accounting, a suspense account serves as a temporary holding place for transactions that can’t be immediately categorized. It helps manage discrepancies, such as missing information and math errors, until issues are resolved. Since it’s used for both debits and credits, it doesn’t have a fixed normal balance — the balance depends on the nature…

A CDJ helps bookkeepers track outgoing cash transactions in one organized place. Instead of recording every payment separately in the general journal, all cash payments are first listed in the cash disbursement journal throughout the period. At the end of the accounting period, the totals are summarized and posted as a single compound entry in…

Retained earnings (RE) are the total profits a company has kept over time instead of paying them out to shareholders. These funds are either reinvested in the business or reserved for future needs. RE are commonly associated with businesses structured as corporations or LLCs, whereas sole proprietorships and partnerships generally do not maintain a retained…

In this article, I’ll guide you through setting up QuickBooks Online for nonprofits, from getting a QuickBooks Online plan and modifying the account setting to creating products and services and setting up classes and locations. The process ensures your income and expense information is perfectly structured to match Form 990 — and with the proper…