March 2009
You are browsing the archive for March 2009.
By Admin on March 30, 2009
Depreciation is a method of applying the matching or accruals concept to the cost of non-current assets. A non-current asset is an asset intended ofr use on a continuing basis in the business. It can be sub-divided into tangible assets (plant, building, motor vehicles, etc.) and intangible assets (goodwill, patents, trademarks, etc.).
Posted in Blog | Tagged Assets |
By Admin on March 25, 2009
Net cash flow from financing activities comprise receipts or repayments of principal from or to external providers of finance. It can help the investors and creditors estimate the claim for the cash flow of the company in the future, and the price to obtain the cash inflows previously.
Posted in Blog | Tagged Cash Flow |
By Admin on March 25, 2009
As known, profit before tax is using the accruals concept, but net cash flow from operating activities only records the cash inflows and outflows according to the trading. Some operating activities impact profit before tax, but not operating cash flow, because of the the accruals concept.
Posted in Blog | Tagged Cash Flow |
By Admin on March 25, 2009
Firstly, we should analyse the structure of cash flow statement. As known, cash flow statement is divided into three parts: operating cash flow, investing cash flow and financing cash flow. And in operating cash flow, there’re two methods to prepare it: the direct and indirect method of cash flow. Secondly, when you’re analysing the cash [...]
Posted in Blog | Tagged Cash Flow |
By Admin on March 24, 2009
The balance sheet shows the financial situation of a company at a point in time (the balance sheet date), but the income statement reflects the operational results of the company over a period of time.
Posted in Blog | Tagged Balance sheet, Income statement |
By Admin on March 24, 2009
Net cash flow from operating activities represents the net increase or decrease in cash form the operations. There are two methods: the direct and indirect method of cash flow. The direct and indirect method of cash flow from operating activities can be used to prepare the cash flow statement, the direct and indirect method have [...]
Posted in Blog | Tagged Cash Flow, Cash Payment |
By Admin on March 24, 2009
Cash concludes cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that can be convertible into readily known amounts of cash, which are insignificant risk of value changing. Bank overdrafts may be counted as a negative element in cash and cash equivalents, though longer-term bank borrowings are generally considered to be [...]
Posted in Blog | Tagged Cash, Cash Flow |
By Admin on March 23, 2009
Trading profit margin = Trading profit(before interest, investment income and tax)/Sales revenue*100% It can describe more accurately the trading performance. Trading profit is gross profit minus interest, investment income and tax. It is equally useful and if the company does not disclose a cost of sales.It may be used to as a lieu of the [...]
Posted in Blog | Tagged Profit, Trading Profit |
By Admin on March 23, 2009
Gross profit percentage = Gross profit/Sales revenue*100% Higher gross profit percetage often means good sign for the company. A company should keep enough gross profit percentage in its business. Because gross profit = revenue – cost of sales, this means you should control the revenue and cost of sales at the same time. Such as: [...]
Posted in Blog | Tagged Gross Profit, Profit |
By Admin on March 23, 2009
Return on capital employed(ROCE) is known as the primary ratio because it’s the most important measure of profitability. The ratio shows how efficiently a business is using its resources. Return on capital employed(ROCE) = Profit/Capital employed*100%
Posted in Blog | Tagged Ratio |
