If the current portion of long term debt is significantly higher than the cash and cash equivalents, the company may not actually be able to pay its debts on time. In such situation, the company’s liquidity position discretionary charge at
If the current portion of long term debt is significantly higher than the cash and cash equivalents, the company may not actually be able to pay its debts on time. In such situation, the company’s liquidity position discretionary charge at
Yes, it’s a formula as most accounting based measures are — but it can be kept quite simple. The contribution margin is when you deduct all connected variable costs from your product’s price, which results in the incremental profit earned
It’s useful to compare ratios between companies in the same industry, and you should also have a sense of the median or average D/E ratio for the company’s industry as a whole. In most cases, liabilities are classified as short-term,
So to find the accumulated depreciation AD, we need to sum the total depreciation expense from each year. Other times, accumulated depreciation may be shown separately for each class of assets, such as furniture, equipment, vehicles, and buildings. For every
Couples frequently arrange for the payments to continue through the lifetime of the surviving partner. This type of investment is often used by those preparing for retirement or for a period of planned unemployment. Depending future value of an ordinary
While this can lead to higher profits with increasing sales, it also increases the company’s financial risk. If sales decline, the company still incurs these fixed costs, which can significantly impact profitability and lead to losses. Therefore, a high degree
The initial investment is $11 million, and the project will last for five years, with the following estimated cash flows per year. Applying the formula for the present value of a single amount, we discount each amount and then add
Joe has 25+ years as a Certified Public Accountant licensed in the State of Texas and solving IRS problems. Experience in a variety of industries as Controller, CFO and tax resolution issues for both business and personal tax cases. An
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