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  What Is the Knowledge Economy? The knowledge economy is a system of consumption and production that is based on  intellectual capital . In particular, it refers to the ability to capitalize on scientific discoveries and basic and applied research. This has come to represent a large component of all economic activity in most developed countries. In a knowledge economy, a significant component of value may thus consist of  intangible assets  such as the value of its workers' knowledge or intellectual property. KEY TAKEAWAYS The knowledge economy describes the contemporary commercialization of science and academic scholarship. In the knowledge economy, innovation based on research is commodified via patents and other forms of intellectual property. In the Information Age, the global economy has moved further toward the knowledge economy. The Knowledge Economy Explained Less developed countries tend to have agriculture and manufacturing-based economies. A developing country has a man

  What is a Key Employee? A key employee is an employee with major ownership and/or decision-making role in the business. Key employees are usually highly compensated either monetarily or with benefits, or both. Key employees may also receive special benefits as an incentive both to join the company and to stay with the company. Understanding Key Employee The term key employee is also used by the  Internal Revenue Service . The IRS uses this term with regard to company-sponsored defined contribution retirement plans. It refers: to an employee who owns more than 5 percent of the business, owns more than 1% of the business, and has annual compensation greater than a certain amount or is an officer with compensation greater than a certain amount. How a Key Employee Affects a Business From an internal perspective, apart from the IRS classification, a key employee may be considered to be an intrinsic part of a company’s operations. Such an employee could be influential in securing capital f

  In QuickBooks Desktop, you'll need to track the holiday pay separately from sick or vacation pay. Let's set this up first by adding a new payroll item. Here's how:   Go to the  Lists  menu, then choose  Payroll Item List . Select the  Payroll Item  drop-down and click  New . Choose  Custom Setup , and select  Next . Choose  Wage , and select  Next , then select  Annual Salary , and select  Next .  Choose  Regular Pay , and select  Next . In the  Name used in paychecks and payroll reports  field, enter Holiday Pay, and select  Next .  The default account for the expense is  Payroll Expenses , then select  Finish .   To track the accruals, you'll need to add this item on your employee's setting. Here's how:   Go to  Employees  menu and select the  Employee Center . Double-click the employee's name to edit the payroll information. Select the  Payroll Info  folder. Add the  Holiday Pay Item  below the  Earnings  section. Once done, click  OK . Adding this item