This category covers all aspects of performance management such as budgeting, forecasting, performance measure and performance evaluation.
Working capital is the measure of a company’s short-term financial health and liquidity. The term working capital also means the difference between the current assets and current liabilities of the company. Current assets are more liquid than fixed assets, so a higher working capital equates favorable liquidity for the company. What is Working Capital Cycle? […]
Working Capital Cycle: Definition and How to Calculate It! Read More »
Budgeting can be defined in several ways on a financial and non-financial basis. The simplest of the budgeting definition is to allocate resources and compare the results against the allocations. The traditional line-item budgeting focuses on cost items and reducing the cost per item basis. Modern budgeting requirements call for activity-based resource allocations. One of
What is Program Budgeting? Definition and Example Read More »
At the point of running an organization, it is essential to see how productive it is. Numerous managers consider the net revenue that processes the total sum by which income from sales surpasses expenses. However, in case you need to know how a particular item adds to the organization’s benefit, you have to consider the
How to Calculate Contribution Margin and its Ratio? Read More »
The defensive Interval period or ratio is a liquidity measure of a business. It gives the idea of business’s ability to meet its operational expenses utilizing current assets. It offers insights on a business’s ability to meet the current expenses without the need for liquidation of long-term assets. What is Defensive Interval Ratio? The Defensive
Defensive Interval Ratio: Definition and How to Calculate? Read More »
The margin of safety calculation takes the break-even analysis one step further in the cost volume profit analysis. It is the difference between the actual activity level and the break-even activity level. We can calculate the margin of safety for sales, revenue, or in profit terms. It can be expressed in units, dollars, or in
How to Calculate Margin of Safety? Read More »
In the property investment or during the company’s operating expenses the measurement and estimation of cost is the foremost priority of a capitalist. The purchase plan of properties requires good financial analysis. To measure these expenses an effective approach is used which is known as the operating expense ratio. In this article, you will get
How to Calculate Operating Expense Ratio? Read More »
In every organization, it is the prime objective of high authorities to manage and control the costs. Businesses have many expenses, the incoming and outgoing of money is part of daily activities. To manage the cost of business the term “Responsibility Accounting” is used where specific people are made responsible for controlling expenditures and accounting
What is Responsibility Accounting? Read More »
As the name indicates this ratio is about the dividend cover. Dividend coverage ratio is one of the few important investor ratio indicators. It provides information on a company’s ability to pay dividends to its shareholders. It also indicates the profits generated by a company and the portion of income distributed among the shareholders. What
Dividend Coverage Ratio: All You Need to Know About! Read More »
The Debt ratio is an important indicator for lenders and stockholders. It indicates the level of a company’s debt against its assets. It’s usual for businesses to offer loans and debts on asset based collateral. However, both lenders and stockholders would be interested to know the company’s level of financing against their assets. So how
How to Calculate Debt Ratio? Read More »
Introduction Fixed assets, often referred to as property, plant and equipment, are an essential part of any business, especially businesses in the manufacturing industry. They use fixed assets in their operations to generate wealth in the long-term. Fixed assets are also defined as assets that business use for more than a single accounting period and
How to Calculate Capital Intensity Ratio? Read More »
