Accounting Tools

APRIL 18, 2023

Related Courses Corporate Finance Essentials of Business Math Financial Analysis What is the Rule of 69? The Rule of 69 is used to estimate the amount of time it will take for an investment to double, assuming continuously compounded interest. The calculation is to divide 69 by the rate of return for an investment and then add 0.35

Corporate Finance 75

Corporate Finance Financial Analysis 75

Accounting Tools

JUNE 12, 2023

Related Courses Cost Accounting Fundamentals Financial Analysis Operations Management How to Calculate Efficiency The efficiency equation is a comparison of the work output from an operation to the work input to that same operation. The amount of "work" could refer to time, effort, capacity , or more tangible items.

Financial Analysis 75

Financial Analysis Cost Accounting Accounting Accounting 75

Accounting Tools

DECEMBER 22, 2023

Related AccountingTools Courses Excel Formulas and Functions Financial Analysis Introduction to Excel Example of the Present Value Factor ABC International has received an offer to be paid $100,000 in one year, or $95,000 now. ABC's cost of capital is 8%.

Financial Analysis 75

Financial Analysis Budgeting 75

Accounting Tools

NOVEMBER 2, 2023

Related Courses Capital Budgeting Corporate Finance Financial Analysis What is the Opportunity Cost of Capital? The opportunity cost of capital is the incremental return on investment that a business foregoes when it elects to use funds for an internal project, rather than investing cash in a marketable security.

Financial Analysis 74

Financial Analysis Corporate Finance Budgeting 74

Accounting Tools

MAY 12, 2024

Related AccountingTools Courses Cost Accounting Fundamentals Financial Analysis Related Articles Allowable Costs Committed Cost Direct Cost Incremental Cost Unavoidable Cost Training can usually be curtailed for extended periods of time, though doing so can reduce the level of employee expertise.

Financial Analysis 75

Financial Analysis Cost Accounting Tax Accounting 75

Accounting Tools

APRIL 17, 2024

This analysis can lead to more robust products, once management realizes that sturdier products incur lower warranty and field servicing costs. Related AccountingTools Courses Capital Budgeting Financial Analysis Purchasing Guidebook Related Article Lifetime Cost

Customer Service 75

Customer Service Budgeting Financial Analysis Cost Accounting 75

Accounting Tools

APRIL 24, 2024

Consequently, any financial analysis of results by month should factor in the number of business days in each of the reporting periods being analyzed. Second, there are substantial holidays within some reporting periods (such as November and December), while other months contain no holidays at all.

Financial Statements 71

Financial Statements Financial Analysis Financial Reporting Bookkeeping 71

Accounting Tools

JUNE 19, 2023

Related Courses Financial Analysis Investing Guidebook What is an Annuity Due? An annuity due is a repeating payment that is made at the beginning of each period, such as a rent payment. It has the following characteristics: All payments are in the same amount (such as a series of payments of $500).

Financial Analysis 75

Financial Analysis 75

Accounting Tools

JUNE 7, 2023

Financial Analysis Effects of Accelerated Depreciation From a financial analysis perspective, accelerated depreciation tends to skew the reported results of a business to reveal profits that are lower than would normally be the case.

Financial Analysis 75

Financial Analysis Record Keeping Tax Auditing 75

Accounting Tools

JULY 16, 2024

years) Related AccountingTools Courses Corporate Finance Essentials of Business Math Financial Analysis The Rule of 72 is fairly accurate for low rates of return, and becomes increasingly inaccurate when higher rates of return are incorporated into the calculation. 72 ÷ 1 = 72.0 years) 2% interest rate. (72 72 ÷ 2 = 36.0 72 ÷ 3 = 24.0

Corporate Finance 75

Corporate Finance Financial Analysis 75

Accounting Tools

APRIL 18, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is Net Profit Margin? Net profit margin is the percentage of revenue left after all expenses have been deducted from sales. The measurement reveals the amount of profit that a business can extract from its total sales.

Financial Analysis 75

Financial Analysis Financial Statements Tax Accounting 75

Accounting Tools

OCTOBER 22, 2023

Related Courses Credit and Collection Guidebook Financial Analysis What is Residual Income? There are three definitions of residual income. Residual Income for Businesses Yet a third definition of residual income relates to a business. We address each one below.

Financial Analysis 40

Financial Analysis Billing Collections 40

Accounting Tools

MARCH 27, 2023

Related Courses Cost Accounting Fundamentals Financial Analysis What is Cost Accounting? Cost accounting examines the cost structure of a business.

Cost Accounting 75

Cost Accounting Financial Statements Accounting Accounting 75

Accounting Tools

OCTOBER 25, 2023

Related Courses Financial Analysis The Interpretation of Financial Statements What is the Accounting Breakeven Point? This concept is used to model the financial structure of a business.

Accruals 75

Accruals Accounting Accounting Financial Analysis 75

Accounting Tools

JUNE 8, 2023

Related Courses Activity-Based Costing Cost Accounting Fundamentals Financial Analysis What is a Mixed Cost? A mixed cost is a cost that contains both a fixed cost component and a variable cost component.

Budgeting 75

Budgeting Financial Analysis Cost Accounting Accounting 75

Accounting Tools

SEPTEMBER 3, 2023

Related Courses Cost Accounting Fundamentals Financial Analysis What is a Sunk Cost? A sunk cost is a cost that an entity has incurred, and which it can no longer recover. Sunk costs should not be considered when making the decision to continue investing in an ongoing project, since these costs cannot be recovered.

Computation 75

Computation Financial Analysis Cost Accounting Accounting 75

Accounting Tools

NOVEMBER 20, 2023

This level of detailed variance analysis allows management to understand why fluctuations occur in its business, and what it can do to change the situation.

Budgeting 75

Budgeting Financial Analysis Billing Cost Accounting 75

Accounting Tools

JUNE 2, 2024

Under this payment method, wages are only paid on a per-unit-produced basis, and so can definitely be classified as a variable cost. One exception to this rule is piece rate wages , which do change with production volumes.

Financial Analysis 40

Financial Analysis Cost Accounting Payroll Tax 40

Accounting Tools

MARCH 25, 2024

This definition relates to the perceived benefit that management believes it can obtain from the additional unit. An example of this definition is the cost of paying overtime to employees to stay on the job and operate a production line for one more hour. Related Article Pricing Strategies

Financial Analysis 40

Financial Analysis 40

Accounting Tools

SEPTEMBER 29, 2023

Examples of Ratios Used in Financial Analysis There are several hundred possible ratios that can be used for analysis purposes, but only a small core group is typically used to gain an understanding of an entity. Examples of profitability ratios are the contribution margin ratio , gross profit ratio , and net profit ratio.

Financial Statements 75

Financial Statements Financial Analysis Accounts Payable Accounts Payable 75

Accounting Tools

AUGUST 2, 2023

Related Courses Capital Budgeting Financial Analysis Investing Guidebook What is the Effective Rate of Return? The effective rate of return is the rate of return generated by an investment when all factors impacting receipts are considered. This approach generates the most comprehensive view of the return on an investment.

Financial Analysis 40

Financial Analysis Budgeting Accounting Accounting 40

Accounting Tools

APRIL 12, 2024

Related AccountingTools Courses Capital Budgeting Financial Analysis Related Article Risk-Adjusted Discount Rate The term also refers to the interest rate that the Federal Reserve Bank charges to depository institutions that take loans from the Fed's discount window.

Financial Analysis 40

Financial Analysis Budgeting 40

Accounting Tools

MAY 9, 2024

In this situation, qualitative factors tend to be addressed after a "hard" quantitative analysis has already been completed. This involves creating a tightly-defined definition of the decision. Related Articles Financial Analysis Financial Ratio Analysis Incremental Analysis Make or Buy Analysis Sales Trend Analysis Trend Analysis

Financial Analysis 40

Financial Analysis Tax 40

Accounting Tools

DECEMBER 22, 2023

This concept is most commonly found at the financial analysis stage of a capital investment, where the projected cash flows of a proposed investment are examined. Negative IRR occurs when the aggregate amount of cash flows caused by an investment is less than the amount of the initial investment.

Financial Analysis 40

Financial Analysis Budgeting 40

Accounting Tools

AUGUST 3, 2023

Related Courses Effective Sales Forecasting Financial Analysis Financial Forecasting and Modeling What is Quantitative Analysis? Quantitative analysis is the use of mathematical models to analyze data points, with the intent of understanding a condition.

Financial Analysis 40

Financial Analysis Budgeting 40

Accounting Tools

MARCH 2, 2024

Related AccountingTools Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements Related Articles Capital Structure Analysis DuPont Analysis Incremental Analysis Quantitative Analysis Types of Financial Analysis

Financial Analysis 40

Financial Analysis Financial Statements Account Receivables Accounts Receivable 40

Accounting Tools

JULY 30, 2023

Related Courses Financial Analysis Financial Analysis Education Bundle The Balance Sheet What are Average Total Assets? Average total assets is defined as the average amount of assets recorded on a company's balance sheet at the end of the current year and preceding year.

Financial Analysis 40

Financial Analysis 40

Accounting Tools

JUNE 10, 2023

Related Courses Financial Analysis Financial Forecasting and Modeling What are Quantitative Factors? These factors are commonly included in various financial analyses, which are then used to evaluate a situation. Quantitative factors are numerical outcomes from a decision that can be measured.

Financial Analysis 40

Financial Analysis 40

Accounting Tools

DECEMBER 28, 2023

Related AccountingTools Courses Excel Charts and Visualizations Financial Analysis Guide to Analytical Procedures The Interpretation of Financial Statements Related Articles Extrapolation Sales Trend Analysis Trend Analysis

Financial Analysis 40

Financial Analysis Financial Statements Budgeting 40

Accounting Tools

AUGUST 23, 2023

Related Courses Financial Analysis What is Marginal Revenue? Marginal revenue is the additional revenue generated by the sale of one extra unit. The concept is frequently used to determine whether special pricing deals are worthwhile. For example, a business can sell 10 units for a total of $100, which is $10 each.

Financial Analysis 40

Financial Analysis 40

Accounting Tools

JUNE 10, 2023

Related Courses Essentials of Business Math Financial Analysis What is Quantification? In business, accounting systems have been designed to measure specific attributes of business transactions , which are then aggregated into financial statements. Quantification is the expression of an event in numeric terms.

Financial Statements 40

Financial Statements Financial Analysis Accounting Accounting 40

Accounting Tools

JULY 25, 2023

Related Courses Corporate Finance Financial Analysis What is the Annualized Rate? The annualized rate is the computed amount of return that would be realized if a short-term investment were to be extrapolated for a period of one year.

Financial Analysis 40

Financial Analysis Corporate Finance Computation Accounting 40

Accounting Tools

JULY 19, 2023

Related Courses Financial Analysis What is Seasonality? Seasonality is a recurring and predictable pattern in the level of business activity over the course of a year. This pattern can be used to predict sales levels throughout the year, and so is incorporated into the annual budgeting process.

Financial Analysis 40

Financial Analysis Budgeting Accounting Accounting 40

Accounting Tools

AUGUST 30, 2023

Related Courses Capital Budgeting Financial Analysis What is Differential Revenue? Differential revenue is the difference in sales that will be generated by two different courses of action. The concept is commonly used when evaluating which of two (or more) investments to make in a business.

Financial Analysis 40

Financial Analysis Budgeting 40

Accounting Tools

APRIL 28, 2023

Related Courses Financial Analysis What is Incremental Revenue? Incremental revenue is the sales associated with an additional quantity sold. The calculation of incremental revenue involves establishing a baseline revenue level and then measuring changes from that point. The concept is used in the following situations.

Financial Analysis 40

Financial Analysis 40

Accounting Tools

JULY 26, 2023

Related Courses Entrepreneur’s Guidebook Financial Analysis The Interpretation of Financial Statements What is Burn Rate? Burn rate is a measure of the speed with which a business is spending its cash reserves.

Financial Analysis 40

Financial Analysis Financial Statements 40

Accounting Tools

JULY 12, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is a Growth Rate? A growth rate is the percentage rate at which a variable is increasing. The rate is measured as a percentage of a baseline period.

Financial Analysis 40

Financial Analysis Financial Statements 40