contribution

(noun)

An amount of money given toward something.

Related Terms

Examples of contribution in the following topics:

  • Overview of Pension Accounting

    • While there are various pension plans in use today, the two most common are the defined benefit and the defined contribution plan.
    • In a defined contribution plan (such as a 401k), while the company makes contributions or matching contributions, it does not promise the future benefit to the employee.
    • In a defined contribution plan the employees bear all the risk.

  • The Trial Balance

    • You contribute $4,000 in cash to start the business.Cash 4,000, Contributed Capital 4,000; Assets(+)=Equity(+)2.
    • The policy covers July 1 through December 31.Cash -1,200, Prepaid Insurance 1,200; Assets(+), Assets(-)The trial balance for debits will be:4,000 (cash) + 500 (PPE) + 400 (inventory) + 1,200 (prepaid insurance) = 6,100The trial balance for credits will be:4,000 (contributed capital) + 500 (cash) + 400 (cash) + 1,200 (cash) = 6,100The calculation will be the same for the next two periods in the example, including any necessary adjustments.
    • 4,000 (contributed capital) + 500 (cash) + 400 (cash) + 1,200 (cash) = 6,100

  • Journalizing

    • You contribute $4,000 in cash to start the business.Cash 4,000 Contributed capital 4,0002.
    • You decide to withdraw $1,000.Contributed capital 1,000 Cash 1,000(this cannot be a dividend, because your balance of retained earnings is negative. )

  • Defining Long-Lived Assets

    • Assets represent probable present benefit, involving a capacity, solely, or in combination with other assets, to contribute directly or indirectly to future net cash flows, and, in the case of not-for-profit organizations, to provide services;
    • When assets are expected to contribute to earnings for multiple years, such assets are referred to as long-lived, non-current or long-term assets.

  • Recording Transactions

    • You contribute $4,000 in cash to start the business.Cash 4,000, Contributed Capital 4,000; Assets(+)=Equity(+)2.
    • You decide to withdraw $1,000.Cash -1,000, Contributed Capital -1,000; Assets(-)=Equity(-)

  • Fundamental Accounting Equation

    • This identity reflects the assumption that all of a company's assets are either financed through debt or through the contribution of funds by the company's owners.

  • Business Stakeholders: Internal and External

    • The community wants the business to contribute positively to its local environment and population.

  • Relationships Between Statements

    • The statement of shareholder's equity reconciles changes in the equity accounts (contributed capital, other capital, treasury stock) from the beginning to the ending balance sheet.

  • What Is the Accounting Cycle?

    • You contribute $4,000 in cash to start the business.2.

  • Additional Factors to Consider

    • This is an example of an additional factor beyond book value that contributes to the overall valuation of a company.