November 23, 2020
Charles Lutwidge
Introduction to Capital Expenditure
Definition Capital expenditure can be defined as any expenditure incurred in creating, acquiring, expanding, or improving an asset for use by a company. The important point is that the benefit from such capital expenditures will be spread over a number...
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November 20, 2020
Charles Lutwidge
Gross Margin Ratio
Gross Margin The goal of any company is to generate money. This income of funds can be calculated and analyzed using different financial and accounting indicators. There are such concepts as revenue, net profit, and gross profit. Gross profit (margin)...
November 20, 2020
Charles Lutwidge
Pros and Cons of Capital Stock
Capital stock (share capital) emerged in the middle of the 19th century with the emergence of a joint-stock form of ownership, when the need for the implementation of investment projects that were beyond the power of sole ownership or partnership...
November 19, 2020
Charles Lutwidge
Financial Leverage: What is It and Why a Business Needs One?
Definition Leverage means the use of borrowed capital as a source of investment financing in order to increase assets and generate higher returns. In finance, through financial leverage, you borrow money, invest, and try to increase your profits through higher...
November 19, 2020
Charles Lutwidge
Debt Ratio – Meaning and Calculation
The debt ratio is an indicator of the financial condition of an enterprise, without which neither managers of organizations, nor owners of companies, nor persons wishing to invest their own funds in any business (e.g. purchase stocks) can do without....
November 03, 2020
Charles Lutwidge
An Introduction to Credit Risk
The operation of enterprises in a changing market environment is certainly accompanied by risks associated with uncertainty of circumstances, as well as the possible occurrence or non-occurrence of certain events. Today, we will talk about credit risk. Modern banks offer...
November 03, 2020
Charles Lutwidge
Direct Write-Off Method
In the practice of enterprises, there are often cases when goods and services are not directly sold for cash or prepayment. Instead, the company sends an invoice along with the goods or after selling the product or providing a service....
November 03, 2020
Charles Lutwidge
Allowance for Doubtful Accounts
Regardless of how perfect and effective the solvency control system is, the company will find buyers who have not paid in time for goods and services sold on credit. Invoices that are not paid by the buyers within the due...
