Adjusted Balance Method

DEFINITION of 'Adjusted Balance Method'

A finance/accounting method where costs are based on the amount(s) owing at the end of the current time period (once credits and payments are posted).

BREAKING DOWN 'Adjusted Balance Method'

Most savings accounts use this system. Interest earned in the account is calculated at the end of the month once all the transactions have been posted.

RELATED TERMS
  1. Previous Balance Method

    A credit card accounting method where interest charges are based ...
  2. Credit Card Balance

    The amount of charges, or lack thereof, owed to the credit card ...
  3. Average Daily Balance Method

    A credit card accounting method where interest charges are based ...
  4. Accounting Method

    The method by which income and expenses are reported for taxation ...
  5. Credit Card Posting

    Adding recent transactions to a consumer’s credit card account.
  6. Post Date

    The month, day and year when a credit card issuer processes a ...
Related Articles
  1. Investing Basics

    Cost Basis Basics

    The term "cost basis" refers to the original value of a security you own. When you sell a stock, bond or mutual fund, you use the cost basis to determine your profit or loss, which in turn affects ...
  2. Professionals

    Accounting Methods

    Accounting Methods
  3. Fundamental Analysis

    The Importance Of Analyzing Accounts Receivable

    While investors often focus on revenues, net income, and earnings per share, they should not overlook the importance of analyzing accounts receivable.
  4. Professionals

    Revenue Recognition Methods and Implications

    CFA Level 1 - Revenue Recognition Methods and Implications. A comprehensive look at the various methods of revenue recognition. Provides details on each method and its implication on profits ...
  5. Economics

    How Does National Income Accounting Work?

    National income accounting is an economic term describing the system used by a country to gather data and determine aggregate economic activity.
  6. Taxes

    How To Calculate The Tax You Owe

    Learn the basic information you need to calculate the taxes you'll owe the government this tax season.
  7. Investing

    Where Should I Keep My Down Payment Savings?

    While saving up for a down payment, where should you keep your money. A bank? The stock market? It all depends on your timeline.
  8. Economics

    The Balance Of Payments

    The "Balance of Payments" is a record of all payments or monetary transactions between a particular country and other nations during a specific time period. It provides a useful glimpse into ...
  9. Credit & Loans

    6 Ways To Build Credit Without A Credit Card

    It's definitely possible – if a bit more complicated – to build a credit history without traditional credit cards. Just follow these steps.
  10. Professionals

    Cash Flow Computations - Direct Method

    CFA Level 1 - Cash Flow Computations - Direct Method. Learn the direct method to calculating a cash flow statement. Includes calculations for free cash flow, a useful valuation measurement.
RELATED FAQS
  1. How is interest charged on most lines of credit?

    Learn how most financial institutions calculate interest on lines of credit by using the average daily balance method and ... Read Answer >>
  2. When do you use installment sales method vs. the cost recovery method?

    Take a deeper look at the installment sales method and the cost recovery method of recognizing business sales revenue and ... Read Answer >>
  3. Why does the Internal Revenue Service (IRS) care about accounting practices?

    Learn why the Internal Revenue Service cares about accounting practices, as these ensure the accurate reporting of financial ... Read Answer >>
  4. How long are accounts receivable allowed to be outstanding?

    Learn about accounts receivable, including how long they typically remain outstanding, and how their payment or lack of payment ... Read Answer >>
  5. What is the difference between accrual accounting and cash accounting?

    Understand the differences between the two basic methods of accounting commonly used by businesses: cash accounting and accrual ... Read Answer >>
  6. What are the main methods for calculating business costs?

    See why different economic actors use different methods for calculating costs, and learn how different methods can impact ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center