Advantages and Disadvantages of Contribution Margin Analysis
What is the purpose of calculating the Contribution Margin of a product or service, and what are the pitfalls that can occur when a simplistic …
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Calculate Average Accounts Receivable: A Component in the Evaluation of Accounts Receivable
“Calculate average accounts receivable! That is very easy, Miss Dannison. I just wonder why you need this for our portfolio. Know anything …
Continue ReadingHow to Calculate Cashflow Payback Period: Is It Still Practical Today?
“Cashflow Payback Period! You are still using it, MIss Perez? Let me tell you one thing: Our competitors have grown fast in a span of two years. …
Continue ReadingWhat Is an Accrued Expense: Examples and Calculations
What is an Accrued Expense? “The financial statements are almost finished, Sir,” declares Miss Ballesteros, the secretary. “But there are some accrued …
Continue ReadingWhat Is Net Profit and How Is It Calculated?
Net profit is an important figure in the eyes of business managers, stakeholders, and financial analysts. Find out what it is and how it’s …
Continue ReadingAccounts Payable Process: A Computerized Base for Various Disbursement Transactions
How does the accounts payable process work? Miss Moore tells of an old theft. “Against accounts payable, Miss Moore?” asks Mr. Smith, …
Continue ReadingHow to Define Incremental Analysis: Explaining Alternative Solutions
Define Incremental Analysis! “Yes, Mr. Stephens. We can accept the offer of Howard Trading. There is an incremental profit of $7,000 because the …
Continue ReadingAccounts Receivable Formulas: For Good Accounts Management
“I understand fundamental accounts receivable formulas! They are just easy to make,” says Anne, the accountant at RidgeLeg. “Yes, …
Continue ReadingExplaining Audit Procedures for Accounts Receivable: Objectives, Scope & Extent
The actual procedures for an AR audit depend on many factors, including whether the audit is for general financial or investigative purposes. Read on …
Continue ReadingTypical Accounts Receivable Fraud Schemes: Examples of Accounting Manipulations
Learn more about common schemes that involve accounts receivable fraud and how to recognize them. It can be tempting to hand over financial matters to …
Continue ReadingAccounts Receivable Aging: An Integral Part of a Debt Collection System
Understand the mechanics and uses of accounts receivable aging in a business’s debt collection system and in ascertaining if credit sales are …
Continue ReadingExplanation & Examples of Net Profit Margin Ratio
Don’t understand net profit margin ratios? In this article we have a look at determining net profit margin ratios, how they are calculated, and …
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