See Also: Return On Equity Example Return on Asset Financial Leverage Gross Profit Margin Ratio Analysis Return on Equity Analysis Fixed Asset Turnover Analysis Return on Equity (ROE) The return on equity, or ROE, is defined as the amount of profit or net income a company earns per investment dollar. It reveals how much profit a company
See Also: Reducing Your Cash Conversion Cycle Key Performance Indicators (KPI’s) Accounting Principles 1, 2, and 3 Accounting Principles 5, 6, and 7 Continuous Accounting: The New Age of Accounting Continuous Accounting is the new age of accounting. It provides a more efficient way to review financial performance in a real-time automated process, and a trustworthy, repeatable accounting cycle
See also: Role of a CFO 5 Ways a CFO Adds Value EBITDA Definition How Does a CFO Bring Value to a Company? Most CEOs don’t understand how a CFO brings value to their company. They see CFOs as overhead rather than income-producers. CEOs typically see the role of a CFO as a CPA or a
Whether times are good or bad, one task that companies still must undertake is projecting revenue. The tougher the times, the more important these forecasts become. When projecting revenue, it’s important to remember that your customer base is likely worldwide. Consequently, you must consider what type of economy your customer is operating in to accurately
When you walk into a shopping mall, what do you see? I see sale signs everywhere! How could a company ever make money if its products or services are always on sale? 50% off, buy 1 get 1 free, 70%… It never ends. Have you wondered if it’s always on sale, is it ever on sale? Marketing
Several years ago, I was consulting with a client in the staffing industry that was having a profitability problem: We have happy customers and seem to be doing well, but we just aren’t making more money… Sound familiar? After visiting with the frustrated owner of the business, I visited various departments to understand the people and
According to Webster’s Dictionary, the breakeven point is defined as “the point at which cost and income are equal and there is neither profit nor loss“. The purpose of breakeven analysis is to determine the point at which revenue received equals the costs associated with receiving the revenue. Simply put, how much revenue we need
The term “Non-profit” is slightly deceiving. Non-profit does not mean “no profit.” In reality, it means that the organization is not in existence for the sole purpose of making profits. Successful non-profits know how to effectively earn profits. Then they need to know how to recycle those funds back into the organization’s mission and operations.
See Also: Return on Invested Capital (ROIC) Return on Common Equity Internal Rate of Return Method Return on Investment (ROI) Definition Return on investment (ROI) is the ratio of profit made in a financial year as a percentage of an investment. In other words, ROI reveals the overall benefit (return) of an investment using the
Non-Profit vs Not-For-Profit Comparison People often interchange Non-profit vs Not-for-profit to refer to organizations that do not redistribute profits or funds to owners or shareholders. In the U.S., the term “non-profit” is used more common. However, not-for-profit is rising in popularity as some organizations want to emphasize that their main objectives do not include making
Is employee turnover a problem in all companies? All companies lose employees. It’s healthy for an organization to have a measurable turnover. Sometimes people don’t fit into a company’s culture. But other times, employees have emergencies or life changing experiences that separate them from the company. However, it is not to say that a 0%
See Also: Is Employee Turnover a Problem? Cost of Turnover Demand for Talented People: Addressing Employee Turnover Protect Yourself: A Guide to Non-Compete Agreements Strategy for Managing Cash Hiring Process is Getting Longer Outsource Definition PEO or Outsource Payroll Employee Turnover Definition Employee turnover, or staff turnover, is a measurement of how many employees are
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