Monthly Archives

March 2022

Assets Equal Liabilities Plus Equity

By BookkeepingNo Comments

These may include loans, accounts payable, mortgages, deferred revenues, bond issues, warranties, and accrued expenses. For a company keeping accurate accounts, every business transaction will be represented in at least two of its accounts. For instance, if a business takes a loan from a bank, the borrowed money will be reflected in its balance sheet as both an increase in the company’s assets and an increase in its loan liability. This straightforward relationship between assets, liabilities, and equity is considered to be the foundation of the double-entry accounting system.

  1. Let’s say your company had $7,000 in inventory last quarter but has $5,000 in inventory now.
  2. Owner’s or stockholders’ equity also reports the amounts invested into the company by the owners plus the cumulative net income of the company that has not been withdrawn or distributed to the owners.
  3. Once we add the $4,665 to thecredit side of the balance sheet column, the two columns equal$30,140.
  4. ‘Retained earnings’ is money held by a company to either reinvest in the business or pay down debt.
  5. Which is why the balance sheet is sometimes called the statement of financial position.

For example, if a company takes on a bank loan to be paid off in 5-years, this account will include the portion of that loan due in the next year. Balancing assets, liabilities, and equity is also the foundation of double-entry bookkeeping—debits and credits. Unlike example #1, where we paid for an increase in the company’s assets with equity, here we’ve paid for it with debt.

Double entry bookkeeping system

Lenders and other third parties typically have first claim on company assets. Market value is the current price, which investors look at to predict its future value. In conclusion, a company’s assets always equal its liabilities plus equity. This is a fundamental accounting principle used to calculate a company’s net worth. The shareholders’ equity number is a company’s total assets minus its total liabilities.

A bank statement is often used by parties outside of a company to gauge the company’s health. Balance sheets allow the user to get an at-a-glance view of the assets and liabilities of the company. In this example, Apple’s total assets of $323.8 billion is segregated towards the top of the report. This asset section is broken into current assets and non-current assets, and each of these categories is broken into more specific accounts. A brief review of Apple’s assets shows that their cash on hand decreased, yet their non-current assets increased.

Balance sheets are one of the most critical financial statements, offering a quick snapshot of the financial health of a company. Learning how to generate them and troubleshoot issues when they don’t balance is an invaluable financial accounting skill that can help you become an indispensable member of your organization. If you’ve found that your balance sheet doesn’t balance, there’s likely a problem with some of the accounting data you’ve relied on.

The Bankrate promise

Right after the bank wires you the money, your cash and your liabilities both go up by $10,000. The type of equity that most people are familiar with is “stock”—i.e. If you’ve promised to pay someone in the future, and haven’t paid them yet, that’s a liability. Assets are anything valuable that your company owns, whether it’s equipment, land, buildings, or intellectual property. There are a few different ways to calculate equity, but the most common approach is to use the net asset value (NAV) method.

The accounting equation states that a company’s total assets are equal to the sum of its liabilities and its shareholders’ equity. Balance sheets are one of the primary statements used to determine the net worth of a company and get a quick overview of it’s financial health. The ability to read and understand a balance sheet is a crucial skill for anyone involved in business, but it’s one that many people lack. If the debit and credit columns equal each other, it means theexpenses equal the revenues. This would happen if a company brokeeven, meaning the company did not make or lose any money. If thereis a difference between the two numbers, that difference is theamount of net income, or net loss, the company has earned.

Financial Statements

With an understanding of each of these terms, let’s take another look at the accounting equation. The basic accounting equation is fundamental to the double-entry accounting system common in bookkeeping wherein every financial transaction has equal how much does a cpa cost and opposite effects in at least two different accounts. On the balance sheet, the assets side represents a company’s resources with positive economic utility, while the liabilities and shareholders equity side reflects the funding sources.

Assets represent the valuable resources controlled by a company, while liabilities represent its obligations. Both liabilities and shareholders’ equity represent how the assets of a company are financed. If it’s financed through debt, it’ll show as a liability, but if it’s financed through issuing equity shares to investors, it’ll show in shareholders’ equity.

As such, the balance sheet is divided into two sides (or sections). The left side of the balance sheet outlines all of a company’s assets. On the right side, the balance sheet outlines the company’s liabilities and shareholders’ equity. The accounting equation is based on the premise that the sum https://www.wave-accounting.net/ of a company’s assets is equal to its total liabilities and shareholders’ equity. As a core concept in modern accounting, this provides the basis for keeping a company’s books balanced across a given accounting cycle. In the Printing Plus case, the credit side is the higher figureat $10,240.

The $4,665 netincome is found by taking the credit of $10,240 and subtracting thedebit of $5,575. When entering net income, it should be written inthe column with the lower total. You then add together the $5,575 and $4,665 to geta total of $10,240. If you review the income statement, you see that netincome is in fact $4,665. A company usually must provide a balance sheet to a lender in order to secure a business loan. A company must also usually provide a balance sheet to private investors when attempting to secure private equity funding.

For example, Celadon Groupmisreported revenues over the span of three years and elevatedearnings during those years. The total overreported income wasapproximately $200–$250 million. This gross misreporting misledinvestors and led to the removal of CeladonGroup from the New York Stock Exchange. Not onlydid this negatively impact CeladonGroup’s stock price and lead to criminalinvestigations, but investors and lenders were left to wonder whatmight happen to their investment.

For example, an investor starts a company and seeds it with $10M. Cash (an asset) rises by $10M, and Share Capital (an equity account) rises by $10M, balancing out the balance sheet. This account may or may not be lumped together with the above account, Current Debt. While they may seem similar, the current portion of long-term debt is specifically the portion due within this year of a piece of debt that has a maturity of more than one year.

ByteDance reorganization offers glimpse into TikTok parent’s future

By Forex TradingNo Comments

Nearly half of those are for Douyin, the Chinese version of TikTok, while its other apps divvy up the remaining users in China and overseas with offerings that range from more video streaming apps to news content and industry-specific platforms. Roughly translating as “Watermelon Video,” the launched app is positioned as a platform for “professional user generated content,” or higher quality content than other user generated apps. Compared with Douyin and TikTok users, who mostly create videos ranging from 15 to 60 seconds, Xigua gives users the opportunity to tell a longer story, with videos lasting around three to five minutes. Now with over 131 million monthly active users (link in Chinese), the app is deemed by some a mini version of Netflix, as its major attraction is content such as variety shows and TV series or films purchased from third parties. The app was ranked the fourth most downloaded free app on the China iOS store on Feb. 17, ahead of Douyin, which was ranked 13th, according to App Annie.

He complained that Tencent’s new games did not perform as well as expected, reports Reuters. While Tencent’s staple hits like Honor of Kings and PUBG Mobile continue to deliver strong revenue, the company’s newer games are losing to those from other Chinese developers like NetEase and miHoYo, developer of Genshin Impact. ByteDance is not the first tech giant to have considered using an app to monitor specific U.S. users. naga broker In 2017, the New York Times reported that Uber had identified various local politicians and regulators and served them a separate, misleading version of the Uber app to avoid regulatory penalties. At the time, Uber acknowledged that it had run the program, called “greyball,” but said it was used to deny ride requests to “opponents who collude with officials on secret ‘stings’ meant to entrap drivers,” among other groups.

  1. There are several types of TikTok ads, including In-Feed ads, Brand Takeovers, and Branded Hashtag Challenges.
  2. Bytedance’s advertising business model is taking market share from other tech giants such as Baidu and Tencent in China as well as Facebook overseas.
  3. To grab users from its strongest rival, Chinese Q&A app Zhihu, the app reportedly lured some influencers who rose to fame with their answers on Zhihu, paying a high price for their content.
  4. In respond to that, Bytedance started to employ a large team of editors to filter and censor content to comply with authorities.
  5. And in spite of the heightened political pressure in the U.S., she said the team-up offers clear benefits for both sides.

ByteDance is reportedly exploring a whole host of new areas that could unlock new monetization potential. A spokesperson for ByteDance declined to comment on the financial figures when contacted by CNBC. Liang is the second Chinese tech CEO to complain about employees this week. ByteDance acquired Baikemy for 500 million yuan (US$70 million) in 2020, according to Chinese media outlet Yicai, when demand for medical care was soaring amid the Covid-19 pandemic. The Coze website is operated by Beijing Chuntian Zhiyun Technology Co, a wholly-owned subsidiary of Beijing Douyin Information Service Co, one of ByteDance’s major entities in China.

Advertising business

Oracle spokesperson Ken Glueck said that while TikTok does currently use Oracle’s cloud services, “we have absolutely no insight one way or the other” into who can access TikTok user data. “Today, TikTok is running in the Oracle cloud, but just like Bank of America, General Motors, and a million other customers, they have full control of everything they’re doing,” he said. But the material reviewed by Forbes indicates that ByteDance’s Internal Audit team was planning to use this location information to surveil individual American citizens, not to target ads or any of these other purposes. Forbes is not disclosing the nature and purpose of the planned surveillance referenced in the materials in order to protect sources. TikTok and ByteDance did not answer questions about whether Internal Audit has specifically targeted any members of the U.S. government, activists, public figures or journalists.

Amidst the coronavirus crisis, while many companies are busy cutting down their workforce, ByteDance in April 2020, announced that it is hiring staff to fill 10,000 vacant posts in different domains. In 2020, ByteDance is planning to hire 40,000 employees, in a bid to match Alibaba’s headcount. Besides, ByteDance is looking forward to strengthening its position in areas such as e-commerce and gaming. Driven by the success of TikTok and their other apps, ByteDance’s yearly revenue ballooned to $80 billion in 2022.

Markets

Similar to the success of its international version TikTok, Douyin has had a good run in China. The app says it had over 400 million daily active users as of January, helping it make up nearly 70% of China’s mobile social network users, according to marketing research firm eMarketer. Douyin and TikTok are two separate entities, although some metrics firms club their numbers.

Lark (Feishu)

ByteDance has launched a platform similar to OpenAI’s GPTs, which allows users to customise its ChatGPT artificial intelligence (AI) bot for specific tasks, as the Chinese owner of TikTok accelerates its AI drive. The researchers said in a new paper that StreamVoice can do “real-time conversion” of a user’s voice to any other, so long as the user has just “one utterance” of speech from the voice they want to imitate. The output occurs at the speed of livestreaming, with just 124 milliseconds of latency, the paper, which noted that AI voice-conversion technology thus far has mostly only been effective “offline,” said. The researchers noted that “recent language-model advancements” allowed them to create this tool.

Northwestern Polytechnical University is not affiliated with Northwestern University in the US. TikTok did not respond to questions about whether it has ever served different content or experiences to government officials, regulators, activists or journalists than the general public in the TikTok app. A China-based team at TikTok’s parent company, ByteDance, planned to use the TikTok app to monitor the personal location of some specific American citizens, according to materials reviewed by Forbes.

TikTok: re-defining social media with user engagement

ByteDance acquired Musical.ly in November 2017 and subsequently merged it with TikTok. Today, the TikTok platform, which is available outside of China, has become the leading destination for short-form mobile videos worldwide. In 2012, Zhang Yiming, a locally trained engineer and serial entrepreneur started Toutiao, a news aggregator app that scrape news from the internet and push to people “based on their interests”. When explaining the business, Zhang Yiming told investors that Toutiao’s recommendation algorithm was powered by artificial intelligence (AI) and machine learning. The CEO emphasized that Toutiao was not a news company, but an AI company in the search business or social media business.

Toutiao became an early flagship of ByteDance and continues to have more than 300 million monthly active users. The company also developed the Indian social media app Hello, as well as the popular Indonesian news aggregator Baca Berita https://traderoom.info/ (BaBe). Douyin, which means “shaking sound,” was one of ByteDance’s first forays into short-form video. It was initially launched in 2016 as a lip-syncing app, but soon saw users posting videos of their daily lives or of memes.

TikTok’s Parent ByteDance Pushes Into Payments With Help From J.P. Morgan

In addition, the consumer-centric nature of Bytedance’s business means it ultimately competes for user spare time, which is limited. Management currently address these issues by creating innovative and differentiated product features. Going abroad to under-penetrated markets was also another strategy that the management is currently adopting. The success of Toutiao has pitted ByteDance into a pitched battle with social media and gaming giant Tencent, parent of the WeChat messaging app, another popular source of news from both publications and self-published authors.

The company has more than 150,000 employees and operates offices worldwide. Liu’s warning followed a similar message from Jack Ma, founder of fellow e-commerce firm Alibaba. Ma took to Alibaba’s internal forum in November calling for “change and reform” to the company, and praising newcomer PDD Holdings. ByteDance CEO Liang Rubo was just the latest to fret about being left behind according to excerpts from his speech posted on the company’s WeChat account. Liang complained that employees were “not sensitive enough to external changes” and griped that staff only started talking about ChatGPT, the buzzy chatbot developed by OpenAI that sparked the AI boom, in 2023. Liu’s warning followed a similar message from Jack Ma, founder of fellow e-commerce firm Alibaba.

Available in 14 Indian languages including Hindi and Marathi, the India-based app offers users a wide range of short videos, jokes, and entertainment news. To better compete with ShareChat, Helo is reportedly introducing English content and aims to double its 50 million monthly active users by the end of last year. ByteDance was founded in 2012 by a team led by Yiming Zhang and Rubo Liang, who saw opportunities in the then-nascent mobile internet market, and aspired to build platforms that could enrich people’s lives. The company launched Toutiao, one of its flagship products, in August 2012. Approximately a year later, ByteDance accelerated globalization with the launch of its global short video product, TikTok. It quickly took off in markets like Southeast Asia, signaling a new opportunity for the company.

The app started off as a Q&A site embedded in Toutiao in 2016 and quickly took off, with over 10,000 questions posted (link in Chinese) on the platform by March 2017, and more than 100,000 answers added every day. Taking note of its strong growth, ByteDance spun the feature out from Toutiao that year. To grab users from its strongest rival, Chinese Q&A app Zhihu, the app reportedly lured some influencers who rose to fame with their answers on Zhihu, paying a high price for their content. However with over 220 million users, Zhihu has maintained its status over Wukong as the largest Chinese Q&A forum. As estimated by mobile app analytics platform Apptopia, one of ByteDance’s top popular products TikTok’s revenue raised by 310% to over $50 million in the last quarter of 2019.