Limitations of Financial Statements
The primary limitations of financial statements are their heavy reliance on historical costs, indifference to inflation, being prone to fraud, being easily manipulated, etc.… Read Article
Income Statement
Types of Financial Statements
There are three basic types of financial statements. We categorize another two important parts of an annual report as financial statements. Let’s begin our… Read Article
EBITDA
Meaning of EBITDAEarnings before Interest, Taxes, Depreciation, and Amortization (EBITDA) can be defined as a company’s operating profit without considering factors such as interest,… Read Article
Net Operating Income
Companies raise debt and equity capital to buy operating and non-operating assets, which are expected to generate revenue going forward. The activities related to… Read Article
Net Profit
Net Profit is a measure of the profitability of the company after taking into consideration all costs incurred during an accounting period. Other names… Read Article
Capitalizing Versus Expensing Costs
Capitalizing versus expensing different costs during the accounting of long-lived assets will have an effect on the company’s profitability, financial ratios, and trends. Both… Read Article
What is Expense? – Definition and Meaning
Expenses can be defined as “Any cost that a company bears in an attempt to maximize its revenues, and thereby its profits.” It is… Read Article