How to Calculate Break Even Sales?
Break even sales is the dollar amount of revenue at which a business earns a profit of zero. This sales amount exactly covers the underlying…
Accounting
What is Chart of Accounts Numbering?
The first type of numbering to determine for a chart of accounts involves their structure. This is the layout of an account number, and involves…
Explain Cost Classification?
Cost classification involves the separation of a group of expenses into different categories. A classification system is used to bring to management’s attention certain costs…
What is Equity Capital Market?
The equity capital market term refers to the interactions between entities requiring funding and those financial institutions that can assist with this search. The financial institutions…
What is Profit Ratio?
The profit ratio compares the earnings reported by a business to its sales. It is a key indicator of the financial health of an organization.…
What are Examples of Operating Expenses?
Operating expenses are those expenditures that a business incurs to engage in any activities not directly associated with the production of goods or services (see…
Operating Cycle Mathematical Explanation
Operating cycle is a measure of the operating efficiency and working capital management of a company. A short operating cycle is good as it tells…
What is the Operating Cycle of Business?
The operating cycle is the average period of time required for a business to make an initial outlay of cash to produce goods, sell the…
What are the Types of Assets?
The two main types of assets are current assets and non-current assets. These classifications are used to aggregate assets into different blocks on the balance…
Working Capital Mathematical Explanation
Working capital is money available to a company for day-to-day operations. The formula for working capital is: Current Assets – Current Liabilities How it works/Example:…
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