The Social Security tax withheld from employees during the year 2010 will be 6.2% of the first $106,800 of each employee’s taxable earnings. The employee’s earnings in excess of $106,800 are not subject to the Social Security tax. In addition to the Social Security tax, the entire amount of [...] Continue Reading…

The maximum FICA tax for the year 2010 remains the same as the 2009 FICA tax: 7.65% on each employee’s first $106,800 of taxable earnings (such as wages, salaries, bonuses, etc.) plus 1.45% of any employee’s taxable earnings in excess of $106,800.

The FICA tax is withheld from each employee’s [...] Continue Reading…

The elements of financial statements are the classes of items contained in the financial statements. Examples of elements include assets, liabilities, equity or net assets, revenues, expenses, gains, and losses.

You can learn more about the elements by reading the FASB’s Statement of Financial Accounting Concepts No. 6, Elements of [...] Continue Reading…

In 1979 the Financial Accounting Standards Board (FASB) issued its Statement of Financial Accounting Standards No. 33 entitled Financial Reporting and Changing Prices. (You will find the original Statement No. 33 on www.FASB.org.) In short, Statement No. 33 required large companies to report supplementary information on the effects of [...] Continue Reading…

Bond prices decrease when interest rates increase because the fixed interest and principal payments stated in the bond will become less attractive to investors.

Let’s illustrate this with a $100,000 bond having a stated interest rate of 9% and having a remaining life of 5 years. This bond will pay [...] Continue Reading…