Accounting Tools

JUNE 7, 2023

Advantages of Financial Leverage Financial leverage has two primary advantages First, it can enhance earnings as a percentage of a firm’s assets. Second, interest expense is tax deductible in many tax jurisdictions, which reduces the net cost of debt to the borrower.

Corporate Finance 75

Corporate Finance Financial Statements Tax Financial Analysis 75

Accounting Tools

MAY 9, 2024

Cost-benefit analysis can include both quantitative factors and qualitative factors. This may include the initial and subsequent investment of funds, as well as the tax effects of depreciation , maintenance costs, and projected price points. This involves creating a tightly-defined definition of the decision.

Financial Analysis 40

Financial Analysis Tax 40

Accounting Tools

JULY 20, 2024

Related AccountingTools Courses Cost Accounting Fundamentals Cost Management Financial Analysis Examples of Incremental Cost There are several situations in which incremental cost analysis can be used to determine the best outcome. Here are several examples: Overtime analysis.

Financial Analysis 40

Financial Analysis Payroll Cost Accounting Tax 40

Accounting Tools

FEBRUARY 12, 2024

To do so, he takes on a loan that has a net after-tax cost of 8%. After one year, he finds that the actual net after-tax return on his purchase of the manufacturing company is just 3%. Related AccountingTools Courses Corporate Finance Financial Analysis The Interpretation of Financial Statements Related Article Leverage Ratios

Corporate Finance 40

Corporate Finance Financial Analysis Financial Statements Tax 40

Accounting Tools

AUGUST 18, 2024

Related AccountingTools Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements How to Calculate the Degree of Financial Leverage The formula for the degree of financial leverage can also be expressed the reported earnings per share, divided by earnings before interest and taxes.

Financial Analysis 40

Financial Analysis Financial Statements Tax 40

Accounting Tools

MARCH 28, 2024

If they had instead invested $200,000 and the business had borrowed $800,000 to still achieve total financing of $1 million, the return on investment would now be 50% (though the after-tax cost of debt must also be considered).

Corporate Finance 40

Corporate Finance Financial Analysis Financial Statements Tax 40

Accounting Tools

JULY 28, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is Net Income Margin? Net income margin is the net after-tax income of a business, expressed as a percentage of sales. It is used in ratio analysis to determine the proportional profitability of a business.

Financial Analysis 40

Financial Analysis Accruals Financial Statements Billing 40

Accounting Tools

JULY 30, 2023

Related Courses Financial Analysis Mergers and Acquisitions The Interpretation of Financial Statements What is Adjusted EBITDA? This approach is used to normalize the reported results of the companies included in an industry analysis.

Financial Statements 40

Financial Statements Financial Analysis Tax 40

Accounting Tools

JUNE 12, 2023

Constraint Analysis The method does not factor in whether or not the capital project under consideration has any impact on the throughput of a company's operations, or on the constrained resource within the organization.

Corporate Finance 75

Corporate Finance Budgeting Tax Financial Analysis 75

Accounting Tools

MAY 21, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is EBITDA? EBITDA is a contraction of earnings before interest, taxes, depreciation , and amortization. However, you should only use it in conjunction with a company's full set of financial statements.

Financial Statements 40

Financial Statements Financial Analysis Accruals Tax 40

Accounting Tools

JULY 11, 2024

Debt financing is less expensive than equity financing, since the interest expense associated with debt is tax deductible , while dividend payouts are not tax deductible. The ratio is usually plotted on a trend line to see how it is changing over time.

Financial Analysis 40

Financial Analysis Corporate Finance Tax 40

Accounting Tools

AUGUST 3, 2023

Related Courses The Income Statement The Interpretation of Financial Statements What is Earnings Before Interest and Taxes? Earnings before interest and taxes is a calculation of the operating earnings of a business. This is typically done by setting up operations in countries that charge a lower income tax rate.

Tax 40

Tax Reconciling Financial Statements Financial Analysis 40

Accounting Tools

JUNE 7, 2023

It reveals the financial viability of the core operations of a business before any extraneous financial or tax-related effects. The expenses not included in the calculation of the operating profit margin are income taxes, interest expense , interest income , and any gain or loss on asset sales.

Financial Statements 40

Financial Statements Tax Financial Analysis 40

Accounting Tools

AUGUST 5, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is the Degree of Operating Leverage? This concept is used to evaluate the cost structure of a business, not including the costs of financing and taxes.

Financial Analysis 40

Financial Analysis Financial Statements Tax 40

Accounting Tools

APRIL 4, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is Income Statement Analysis? The analysis of the income statement involves comparing the different line items within a statement, as well as following trend lines of individual line items over multiple periods.

Financial Analysis 40

Financial Analysis Financial Statements Tax Accounting 40

Accounting Tools

DECEMBER 28, 2023

The cost of both types of indirect labor can be fully loaded with the costs of benefits and payroll taxes for financial analysis or cost accounting purposes, since these additional costs are closely associated with the indirect labor positions.

Financial Analysis 40

Financial Analysis Cost Accounting Payroll Tax 40

Accounting Tools

NOVEMBER 1, 2023

Related Courses Capital Budgeting Financial Analysis What is Return on Investment? The formula is: Net after-tax income ÷ Total assets invested = Return on investment How Return on Investment is Used The measurement can be used for multiple types of decisions.

Financial Analysis 40

Financial Analysis Budgeting Tax 40

Accounting Tools

APRIL 28, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is the Net Income Formula? The reverse situation can also occur, where the net profit figure is artificially reduced in order to avoid paying income taxes.

Financial Analysis 40

Financial Analysis Accruals Financial Statements Tax 40

Accounting Tools

OCTOBER 22, 2023

Related Courses Budgeting Capital Budgeting Financial Analysis What are Profit Variances? Profit variance is the difference between the actual profit experienced and the budgeted profit level. There are four types of profit variance, which are derived from different parts of the income statement. They are noted below.

Budgeting 40

Budgeting Financial Analysis Tax 40

Accounting Tools

APRIL 7, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is the Variable Contribution Margin? If the calculation is being made for services, this typically includes the cost of labor, variable benefits, payroll taxes , and commissions.

Financial Analysis 40

Financial Analysis Financial Statements Payroll Tax 40

Accounting Tools

SEPTEMBER 10, 2023

Related Courses Business Ratios Guidebook Financial Analysis The Interpretation of Financial Statements What is Profit Margin? Finally, the profit margin appears at the bottom of the income statement, after all financing-related line items and taxes. from each dollar of sales generated. What is a Good Profit Margin?

Financial Analysis 40

Financial Analysis Tax Financial Statements Auditing 40

Accounting Tools

JUNE 17, 2023

Related Courses Capital Budgeting Financial Analysis What is the Incremental Internal Rate of Return? The incremental internal rate of return is an analysis of the financial return to an investor or entity where there are two competing investment opportunities involving different amounts of investment.

Financial Analysis 40

Financial Analysis Budgeting Tax Accounting 40

Accounting Tools

JULY 9, 2023

The concept is used in financial analysis to find the breakeven point of a business, as well as to determine product pricing. Examples of other fixed costs are insurance, depreciation , and property taxes. A fixed cost is a cost that does not increase or decrease in conjunction with any activities.

Accruals 40

Accruals Financial Analysis Cost Accounting Tax 40

Accounting Tools

JULY 20, 2023

Related Courses Capital Budgeting Financial Analysis What is the Accounting Rate of Return? Related Articles After-Tax Real Rate of Return How to Calculate the Internal Rate of Return Incremental Internal Rate of Return Internal Rate of Return The Effective Rate of Return The Simple Rate of Return

Accruals 40

Accruals Accounting Accounting Financial Analysis 40

Accounting Tools

APRIL 17, 2023

The balance sheet is commonly used for a great deal of financial analysis of a business' performance. The balance sheet is one of the key elements in the financial statements , of which the other documents are the income statement and the statement of cash flows.

Accounts Receivable 40

Accounts Receivable Account Receivables Accounts Receivable Financial Statements 40

Nanonets

FEBRUARY 28, 2024

This meticulous document serves as the foundation for a company's financial statements, categorizing and recording each transaction. Through this rigorous organization, it provides an essential snapshot, offering a comprehensive view of the company's financial health and facilitating detailed financial analysis and reporting.

General Ledger 52

General Ledger Data Entry Invoicing Accounts Payable 52

Accounting Tools

NOVEMBER 3, 2023

And second, interest expense is tax deductible in many tax jurisdictions, which reduces the net cost to the borrower. First, it may allow an entity to earn a disproportionate amount on its assets, especially when a large amount of debt financing is used.

Corporate Finance 40

Corporate Finance Tax Financial Analysis 40

Accounting Tools

APRIL 24, 2023

Several issues included in the yield to maturity calculation are as follows: It discounts cash flows to their present value All coupon payments are assumed to be reinvested at the same rate of return as the current yield to maturity All coupon payments are assumed to be paid on time There is no consideration of the transaction costs required to buy (..)

Corporate Finance 40

Corporate Finance Tax Financial Analysis 40

Nanonets

SEPTEMBER 21, 2023

Unlike purchase orders and receipts, invoices specifically request payment and serve multiple purposes, including record-keeping, accounting, tax documentation, and legal protection. In addition to aiding in financial transactions, invoices are an integral part of  accounting internal controls  and  audits.

Invoicing 40

Invoicing Purchase Order Accounts Payable Accounts Payable 40

Accounting Tools

OCTOBER 26, 2023

Related Courses The Interpretation of Financial Statements Real Estate Accounting Real Estate Tax Guide What are Funds from Operations? Funds from operations is the cash flows generated by the operations of a business, usually a real estate investment trust (REIT).

Financial Statements 40

Financial Statements Tax Accounting Accounting 40

Accounting Tools

JULY 20, 2023

Related Articles Earnings Before Interest and Taxes How to Calculate Net Operating Income Income Statement Analysis Profit Analysis The Net Income Formula What is EBITDA? Usually, it is quite difficult to extract the cost of revenue from an income statement , since it is more oriented toward the reporting of gross margin.

Financial Statements 40

Financial Statements Tax Financial Analysis 40

Nanonets

FEBRUARY 13, 2024

Moreover, understanding which expenses fall into which categories is essential when it comes to tax time. Certain expenses are tax-deductible, meaning they can be subtracted from your total taxable income, effectively reducing the amount of tax you owe. This is where the magic of categorization truly shines.

Accounting Software 52

Accounting Software Tax Financial Records Payroll 52

Nanonets

FEBRUARY 8, 2024

QuickBooks Payroll Although it works automatically with QuickBooks, QuickBooks Payroll is a QuickBooks app that brings together payroll, HR, tax compliance, and health benefits – everything you need to make it through another payroll cycle. When tax time comes, you’ll be so glad to have both of these tools in your arsenal.

QuickBooks 52

QuickBooks AR Collections AR Payroll 52

Nanonets

SEPTEMBER 22, 2023

Sales Order Meaning and Definition A  sales order  is a document filled out by a customer, typically indicating their intention to purchase goods or services from a business. It facilitates effective communication, enables efficient order fulfillment, and provides valuable data for business analysis.

Invoicing 52

Invoicing Deposits Record Keeping Financial Records 52