Why is real estate traditionally considered a relatively illiquid economic product?
Why is real estate traditionally considered a relatively illiquid economic product? Its physical form is fixed. Real estate is defined as land, not water. It is often difficult to convert to cash.
What the market recognizes as the change in value an improvement makes to a property is called what?
What the market recognizes as the change in value an improvement makes to a property is called what? Contribution. The sales comparison approach is based on what principle of value? Substitution. The income capitalization approach, or income approach, is more specifically used for appraising.
How accruals are treated in balance sheet?
If an accrual is recorded for an expense, you are debiting the expense account and crediting an accrued liability account (which appears in the balance sheet). Therefore, when you accrue an expense, it appears in the current liabilities portion of the balance sheet.
What is Eoy accrual?
A year-end accrual is a transaction with a sale or expense that occurs in one fiscal year but whose invoicing occurs during the following fiscal year.
What is Boy vs Eoy?
In practice EOY is likely the most commonly selected option. In theory, in annual discounting models like FAMOUS, BOY is the better option, the idea being that the investment is made at the beginning of the year (end of the previous year) and then used throughout the year to generate sales or manage costs for the year.
What does Eoy mean?
end of year
How do you record payments of accrued and current salaries?
Debit salaries expense and credit salaries payable to record the accrued salaries. Salaries expense is an income-statement account that reduces the net income for the period.
How do you record salary on a balance sheet?
Salaries do not appear directly on a balance sheet, because the balance sheet only covers the current assets, liabilities and owners equity of the company. Any salaries owed by not yet paid would appear as a current liability, but any future or projected salaries would not show up at all.
Is wages an asset or expense?
Wages expense is an expense account, whereas wages payable is a current liability account. A current liability is one that the company must pay within one year. The company presents its expense accounts on the income statement and its liability accounts on the balance sheet.
Is payroll considered an expense?
Payroll expense is the amount of salaries and wages paid to employees in exchange for services rendered by them to a business. In a cash basis company, payroll expense is the cash paid during an accounting period for salaries and wages.
How do you record an accrual?
Usually, an accrued expense journal entry is a debit to an Expense account. The debit entry increases your expenses. You also apply a credit to an Accrued Liabilities account. The credit increases your liabilities.