A definitive market entry process an organization may seek after on its own is by constructing an entirely owned subsidiary in the target market. It is a type of foreign direct investment and is known as Greenfield investment. Greenfield projects are an approach to expand into emerging business sectors. They generally include a parent firm […]
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Nowadays, maximizing shareholder’s wealth is critical and has determinant importance towards the success or failure of an organization. Shareholder wealth maximization holds key functions in generating profits for an organization. During the time of business supervisors putting efforts to boost the wealth of their organization, they are actually attempting to raise the firm’s stock price.
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Earnings per share is the part of an organization’s benefit, which is distributed to every individual share of the stock. It holds much significance to shareholders and individuals who exchange in the stock market. When the earnings per share of a business are high, then its productivity also increases. For determining the earnings per share,
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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 »
Business failures with startups and small size entities are common. Broadly speaking there can be several types of business failures and reasons causing such it. Financial accountants often term liquidity crunch more fatal than profitability for settled businesses. New business startups may fail due to inadequate planning and insufficient resources. What is Business Failure? We
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In investing terms, the margin is the money borrowed by the investors for making an investment or transaction. Particularly in stock and derivative markets, the investors utilize leverage allowed by the broker and clearing houses. These clearing houses and brokers require investors to maintain a certain minimum balance in their margin accounts. What is the
What is the Maintenance Margin? Definition and How it Works? Read More »
What is a Standby Letter of Credit? A standby letter of credit is a secondary payment instrument. It acts as an additional layer of security to the suppliers (the second party) in case of non-performance of the contract. The issuing banks offer an additional cushion to the receivers of LC on default payments. These are
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A letter of Credit is a documentary credit that an issuing bank guarantees to the suppliers if the buyers default on payment. Banks become intermediary parties between the sellers and buyers, usually in international trade contracts. However, the documentary credit or LC contracts are different documents from the original sales contract. Depending on LC characteristics,
Revocable Letter of Credit: Definition and How it Works? 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 »
Auditing is the process of examining the financial statements of a company. Usually, external auditors conduct audits. External auditors are independent parties not related to the management of the auditee company. The process of auditing consists of many different procedures that auditors perform to form an opinion on whether the financial statements present a true
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