What are Tax Refunds? Tax, Slightly Cynical, Talk Why do business owners have to pay payroll taxes? Note that the content is meant to be educational, only. Explanation: We often learn best with images and with a story, and a story needs memorable characters with strong characteristics. Thinking about tax law and the tax code as an interplay taking place over time between a greedy tax collector and hard working business person or employee can provide content to help memorize the law and make the process more fun. This information is not designed to promote a political opinion or to talk down about a person, party, or organization in particular even though the government and the IRS will typically be the bad guy. In reality, the IRS is an institution that is part of a democracy and does not represent one character with greedy intentions but is rather much more complex.

Financial Accounting – Accounting cycle – We cover most introductory financial accounting topics in detail. Links to relevant parts of the video below. Financial Accounting Overview: 0:17 Why Learn Accounting 19:58 Accounting Objectives 29:22 Accounting Equation 44:36 Balance Sheet 1:01:58 Income Statement 1:15:22 Statement of Equity 1:26:11 Balance Sheet & Income Statement Relationship 1:49:58 Cash Method vs Accrual Method 2:06:17 Ethics Profession 2:22:19 Financial Transaction Rules 2:36:07 Financial Transaction Thought Process 2:47:29 Cash Transactions 3:04:24 Accounts Receivable Transactions With Accounting Equation 3:14:50 Accounts Payable Transactions with Accounting Equation Debits and Credits Financial Transactions 3:40:12 Debits & Credits 3:56:01 Rules for Using Debits & Credits 4:14:28 Transaction Thought Process 4:28:08 Trial Balance 4:43:10 Cash Journal Entries with Debits and Credits 5:01:11 Accounts Receivable Transactions Using Debits and Credits 5:11:16 Accounts Payable Transactions Using Debits and Credits 5:33:44 General Ledger Adjusting Entries: 5:48:11 Accounting Cycle Steps in The Accounting Process 5:41:11 Types of Adjusting Journal Entries 6:15:33 Adjusting Journal Entry Rules 6:20:16 Why Use a Worksheet in Adjusting Process 6:31:29 Adjusting Journal Entries Thought Process 6:42:42 Adjusting Entries 6:47:54 Adjusting Entries Unearned Revenue 6:47:54 Adjusting Entries Wages or payroll 6:58:06 Adjusting Entry Accounts Receivable or income or revenue 7:03:27 Adjusting Entries Insurance 7:09:48 Adjusting Entries Depreciation 7:14:58 Reversing Journal Entries – Accrued Revenue 7:24:12 Balance Sheet Current Assets From Trial Balance 7:14:58 Balance Sheet Property Plant and Equipment from Trial Balance 7:33:31 Balance Sheet Liabilities 7:37:33 Balance Sheet Equity Section 7:44:00 Income Statement From Trial Balance 7:53:13 Statement of Equity From Trial Balance 8:02:12 Financial Statement Relationship Closing Process 8:08:29 Accounting Cycle 8:18:31 Closing Process Explained 8:25:51 Post Closing Trial Balance 8:29:56 One Step Closing Process 8:41:46 Two Step Closing Process 8:52:40 Four Step Closing Process – Step one 8:38:53 Four Step Closing Process – Step Two 9:02:21 Four Step Closing Process – Step Three 9:07:51 Four Step Closing Process – Step Four 9:15:17 Post Closing trial Balance & Financial Statements Merchandising Transactions – Transactions With Inventory 9:21:39 Accounting Cycle for Merchandising Company 9:24:56 Perpetual Inventory System 9:43:32 Periodic Inventory System 10:06:02 Perpetual vs. Periodic Inventory Systems 10:22:52 Merchandising Transactions – Purchaser and Seller 10:28:45 Purchases of Inventory Journal Entry 10:34:01 Sale of Inventory Journal Entry – Perpetual Inventory Method 10:41:13 Sales Discount Vs Purchases Discount 10:46:52 Purchase Discount Journal Entry 10:53:27 Sales Discount Journal Entry 11:00:45 Inventory Shrinkage 11:09:51 Sales Returns and Allowances Transaction 11:25:51 Income Statement Introduction 11:32:47 Financial Statements for a Merchandising Company Business Objective To generate revenue by providing goods or services to a community. For example, the mission statement of Auto-Owner Insurance is: “Our Goal is to provide the best claim service in the industry” (Mis). A company’s mission should describe the ideal goods and services that the company provides. The success of a company’s ability of achieve its mission will be measured, in part, by revenue. If revenue cannot be produced the good and services the company strives to provide will not be provided because the company will eventually go out of business. The business objectives should be separated from personal objectives. This separation is not an indication that the business objective is more important but because it will help us measure the success of both the business objectives and as our personal objective. Our business objectives can be thought of as fitting within our personal objectives, meaning they are separate from the personal objectives but the personal objectives are the primary goal. Our personal objectives will vary from person to person but can be thought of as the desire to live well for our purposes here. Separating business and personal objectives allows us to measure both better, providing better tools to achieve more goals in both realms. For example, if we started a small business one of the first things we would consider doing is setting up a separate business bank account and or business credit card. For the most part, everything we purchase is either an expense or an asset. The question we need to consider is whether the purchase is a business expense or asset or a personal expense or asset. This questions can be answered by asking what the objective of the purchase are. For example, if we purchased a building to be used for the business it would be a business asset because we purchased it to h

Links to parts of the presentation below. 0:16 Flow of Materials, Labor, & Overhead 18:37 Methods to Calculate Ending WIP and Units Completed 23:09 Equivalent Units of Production – Weighted Average Method 28:29 Cost Per Equivalent Unit Calculation – Weighted Average Method 31:18 Assign Costs to Units – Weighted Average Method 36:34 Overhead Costs 47:44 Overhead Allocation – Predetermined Overhead Rate 56:17 Overhead – Under Applied or Over Applied 1:03:57 Equivalent Units – First In First Out (FIFO) Method A process cost system is one of the two accounting system generally used in managerial accounting or cost accounting for a manufacturing company. To understand a process cost system we often contrast it to the other major managerial or cost accounting system, a job order costing system. The process costing system and the job order costing system is not completely different or opposite cost accounting or managerial accounting methods, but contrasting the two gives us a good point of reference to talk about them both. Both the process cost system and job cost system of accounting for the production of inventory use many of the same accounting. Both will record the conversion of inventory from raw materials to finished goods and finally record the sale in the form of cost of goods sold. The accounts involved in a manufacturing company related to the production of inventory include raw materials, work in process, overhead, finished goods, and finally cost of goods sold. Raw materials represent inventory that has not yet been processed, has not yet been converted to finished goods. Raw material will generally go up at the point of purchase with a debit to raw materials and a credit to accounts payable or cash. The raw materials will then move work in process or overhead depending on if we can apply the material to a process. In a job cost system, we would apply the materials to a job as we enter the debit to the work in process WIP account. Once in work in process the materials will be converted to inventory by adding the conversion costs, including labor and overhead. Work in process will include materials, labor, and overhead. Once completed the work and process will be transferred to finished goods where it is ready to be sold. When the inventory is sold the cost of the inventory is recorded in cost of goods sold. A process cost system will need to track the cost of inventory as it moves through each process. To help with the allocation of cast we will calculate cost per equivalent unit and allocate the costs that are still in a process and those that have been transferred. We can allocate costs using a first in first out method or a weighted average method. The weighted average method may be easier and have fewer steps, but both accounting methods are a type of estimate.

Individual retirement account income tax treatment. See links below to jump to relevant parts of IRA video. 0:35 Introduction & What is Compensation? 11:25 What’s New & Remainders 23:31 Individual Retirement Annuity 27:38 Simple IRAs 30:12 Simple Employee Pension (SEP) 33:03 How Much Can Be Contributed? 34:40 General Limit 41:39 Kay Bailey Hutchison Spousal IRA Limit 44:37 How Can a Traditional IRA Be Opened? – Filing Status 49:23 How Can a Traditional IRA Be Opened? – Maximum Contributions 53:10 When Can Contributions be Made? 1:05:37 How Much Can You Deduct? 1:11:57 Are You Covered by An Employer Plan? 1:25:45 Limit if Covered by Employer Plan 1:43:33 Tax Software Limit if Covered by Employer Plan 1:50:10 Figure (Calculate) Reduced IRA Deduction & Reporting Deduction Contributions 1:54:12 Nondeductible Contributions 2:05:33 Example – Worksheet for Reduced IRA Deduction for 2018 2:13:29 What if You Inherit and IRA? 2:22:58 Can You Move Retirement Plan Assets? 2:25:28 Trustee to Trustee Transfer 2:28:00 Can You Move Retirement Plan Assets? Rollover 2:41:11 Time Limit for Making a Rollover Contribution 2:55:41 Rollover From One IRA Into Another 3:11:09 Rollover From Employer’s Plan Into an IRA 3:28:46 Rollover Chart 3:37:54 Transfers Incident to Divorce 3:44:39 Converting From Any Traditional IRA Into a Roth IRA 3:54:21 When Can Your Withdraw or Use Assets? 3:57:24 Contributions Returned Before Due Date of Return 4:03:15 Prohibited Transactions 4:07:09 Exempt Transactions 4:10:03 Investment in Collectibles 4:15:42 Excess Contributions 4:30:15 Reporting Additional Taxes Publication 334 – Tax Guide for Small Business https://www.irs.gov/pub/irs-pdf/p334.pdf Publication 535 – Business Expenses https://www.irs.gov/pub/irs-pdf/p535.pdf Are You Self-Employed? You are a self-employed person if you carry on a trade or business as a sole proprietor or an independent contractor. Trade or business. A trade or business generally is an activity carried on to make a profit. The facts and circumstances of each case determine whether or not an activity is a trade or business. You do not need to actually make a profit to be in a trade or business as long as you have a profit motive. You do need to make ongoing efforts to further the interests of your business. Limited liability company (LLC). A limited liability company (LLC) is an entity formed under state law by filing articles of organization. Generally, for income tax purposes, a single-member LLC is disregarded as an entity separate from its owner and reports its income and deductions on its owner’s federal income tax return. For example, if the single-member LLC is not engaged in farming and the owner is an individual, he or she may use Schedule C or C-EZ. Sole proprietor. A sole proprietor is someone who owns an unincorporated business by himself or herself. You also are a sole proprietor for income tax purposes if you are an individual and the sole member of a domestic limited liability company (LLC) unless you elect to have the LLC treated as a corporation. Independent contractor. People such as doctors, dentists, veterinarians, lawyers, accountants, contractors, subcontractors, public stenographers, or auctioneers who are in an independent trade, business, or profession in which they offer their services to the general public generally are independent contractors. However, whether they are independent contractors or employees depends on the facts in each case. The general rule is that an individual is an independent contractor if the person paying for the work has the right to control or to direct only the result of the work and not how it will be done. The earnings of a person who is working as an independent contractor are subject to self-employment tax. For more information on determining whether you are an employee or independent contractor, see Pub. 15-A, Employer’s Supplemental Tax Guide. Are You a Statutory Employee? A statutory employee has a checkmark in box 13 of his or her Form W-2, Wage and Tax Statement. Statutory employees use Schedule C or C-EZ to report their wages and expenses. How Do I Pay Income Tax? Federal income tax is a pay-as-you-go tax. You must pay it as you earn or receive income during the year. An employee usually has income tax withheld from his or her pay. If you do not pay your tax through withholding, or do not pay enough tax that way, you might have to pay estimated tax. Estimated tax payments. You generally have to make estimated tax payments if you expect to owe taxes, including self-employment tax (discussed later), of $1,000 or more when you file your return. Use Form 1040-ES, Estimated Tax for Individuals, to figure and pay the tax. If you do not have to make estimated tax payments, you can pay any tax due when you file your return. For more information on estimated tax, see Pub. 505. What are my options for paying estimated tax? You can pay your estimated tax electronically usin