Bookkeeping

A separate bank account and credit card will simplify your bookkeeping and prevent unnecessary errors. Try to keep track of everything, no matter how big or small the expense, as you’ll have to account for them when you file taxes. For as little as zero dollars per month, you can track and categorize transactions and […]

As you will learn in future chapters, in order for businesses to remain profitable, it is important for managers to understand how to measure and manage fixed and variable costs for decision-making. In this chapter, we begin examining the relationship among sales volume, fixed costs, variable costs, and profit in decision-making. We will discuss how

Accounts receivable are effectively interest-free loans that are short-term in nature and are extended by companies to their customers. If a company generates a sale to a client, it could extend terms of 30 or 60 days, meaning the client has 30 to 60 days to pay for the product. If your organization offers credit

For this section of the exercise, the key takeaway is that the CM requires matching the revenue from the sale of a specific product line, along with coinciding variable costs for that particular product. Using the provided data above, we can calculate the price per unit by dividing the total product revenue by the number

If a company’s D/E ratio is too high, it may be considered a high-risk investment because the company will have to use more of its future earnings to pay off its debts. For example, asset-heavy industries such as utilities and transportation tend to have higher D/E ratios because their business models require more debt to

For this section of the exercise, the key takeaway is that the CM requires matching the revenue from the sale of a specific product line, along with coinciding variable costs for that particular product. Using the provided data above, we can calculate the price per unit by dividing the total product revenue by the number

If the idea of identifying solid long-term investments and then managing them sounds like too much trouble to you, you’re not alone. Fortunately, you can invest in real estate without having to worry about this. You can buy into a real estate investment trust (also known as a REIT) or invest in a real estate

The only difference in this case is that the accounting entry for the debit is called “treasury stock.” Ordinary shareholders take on greater financial risk than preferred shareholders of a corporation, but they also may reap greater rewards. The interchangeability of the terms stocks and shares applies mainly to American English. The two words still

These can include industry averages, the S&P 500 average, or the D/E ratio of a competitor. It’s also helpful to analyze the trends of the company’s cash flow from year to year. The following D/E ratio calculation is for Restoration Hardware (RH) and is based on its 10-K filing for the financial year ending on

These can include industry averages, the S&P 500 average, or the D/E ratio of a competitor. It’s also helpful to analyze the trends of the company’s cash flow from year to year. The following D/E ratio calculation is for Restoration Hardware (RH) and is based on its 10-K filing for the financial year ending on