See also: Standard Chart of Accounts Chart of Accounts (COA) Complex COA Number for SGA Expenses Example Chart of Accounts for Selling General and Administrative Time Saving Tip for Filing Vendor Invoices Problems in Chart of Accounts Design Too Many General Ledger Accounts Often when using QuickBooks or Peachtree accounting software the number of general
See also: SWOT Analysis Threat of New Entrants Supplier Power Buyer Bargaining Power Threat of Substitutes Intensity of Rivalry Complementors (Sixth Force) Marketing Mix (4 P’s of Marketing) Porter’s Five Forces of Competition Definition Porter’s 5 forces framework is used for strategic industry analysis. It was developed in 1979 by Michael Porter, Harvard Business School
See Also: Collateralized Debt Obligations Convertible Debt Instrument Debt Ratio Analysis Debt Service Coverage Ratio (DSCR) Overhead Rate Imprest Account Outstanding Debt Definition Outstanding debt, defined as the total principal as well as interest amount of a debt that has yet to be paid, is of core importance for any company which has used debt
See Also: Organizational Structure Advantages of Centralization Advantages of Decentralization There are several advantages and disadvantages of decentralizing an organization. Decentralizing is optimal when subunit managers and employees have specialized knowledge regarding their particular subunit. Giving subunit managers authority is a good way to train them for future positions in senior management. Empowering employees and
See Also: Net Profit Margin Ratio Gross Profit Margin Opportunity Profit Margin Ratio Financial Ratios Net Income What is Profitability Index (PI)? Net Profit Margin Definition The net profit margin, also known as net margin, indicates how much net income a company makes with total sales achieved. A higher net profit margin means that a
See Also: Operating Profit Margin Ratio Analysis Operating Profit Margin Example In an operating profit margin example, Bill is the founder and CEO of a retail store called Shopco. Shopco recently took a loan. Shopco has experienced a dip in sales, because of the recession, and wants to make sure they can keep net operating
See Also: Operating Profit Margin Ratio Example Net Profit Margin Operating Income (EBIT) Financial Ratios Gross Profit Margin Ratio Analysis Interest Expense Operating Profit Margin Ratio The operating profit margin ratio indicates how much profit a company makes after paying for variable costs of production such as wages, raw materials, etc. It is also expressed as
See Also: Homemade Leverage Valuation Methods Financial Ratios Operating Profit Margin Ratio Operating Cycle What Your Banker Wants You to Know Operating Leverage Definition Operating leverage is a measure of the combination of fixed costs and variable costs in a company’s cost structure. A company with high fixed costs and low variable costs has high
See Also: Business Risk Commercial Risk Interest Rate Risk Investment Risk Risk Premium Moral Hazard Definition Moral hazard, defined are the circumstances or situations that increase the probability or riskiness of a loss. This is often due to a person’s habits or morals. Moral Hazard Explained Moral hazard risk is the risk that is associated
See Also: Operating Income (EBIT) Operating Income Example For example, Marilyn is the CEO of a company which creates educational children’s toys. Marilyn loves her work and truly knows her business. With the support of her family and local bank Marilyn has taken her idea from startup to success in only 3 years. Pleased with
See Also: Operating Income Example EBITDA Definition Net Income Free Cash Flow Operating Profit Margin Ratio Time Value of Money (TVM) What is operating income? Earnings before interest and tax, also know as operating income (EBIT), is defined as a measure of a company’s profit from ordinary operations, excluding interest and tax. EBIT is also
See Also: Company Life Cycle Pricing Strategies Marking to Market Benchmarking Capitalization Market Positioning Definition What is market position? In marketing and business strategy, market position refers to the consumer’s perception of a brand or product in relation to competing brands or products. Market positioning refers to the process of establishing the image or identity
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