The current portion of long-term debt (CPLTD) is the amount of unpaid principal from long-term debt that has accrued in a company’s normal operating cycle (typically less than 12 months). It is considered a current liability because it has to be paid within that period. This line item is closely followed by creditors, lenders, and investors, …

current portion of long-term debt definition and meaning Read More »

That said, work and personal life can sometimes get https://www.bookstime.com/articles/what-is-order-of-liquidity in the way, resulting in a late payment. For you, this means you’ll need to get in touch and remind your client to pay you. In turn, stating the client’s information on your invoice is also beneficial for future reference, especially if the relationship turns sour. …

How to Invoice as a Freelancer: Things You MUST Include & Free Template Read More »

It helps businesses identify the additional costs incurred and the corresponding benefits gained by choosing one option over another. This analysis enables decision-makers to allocate resources efficiently and optimize their financial outcomes. A fixed building lease for example, does not change in price when you increase production. The fixed cost will reduce against the cost …

Incremental Costing: How to Calculate and Compare the Incremental Costs and Benefits of Different Options Read More »

If you are investing your money, ratherthan saving it in fixed rate accounts, the reality is that returns on investments will vary year on year due to fluctuations in interest rates, market conditions, inflation, and other economic factors. We’ve discussed what compound interest is and how it is calculated. So, let’s now break down interest …

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In addition, small businesses that need to remain nimble and creative often find the Six Sigma system of process analysis stifling, bureaucratic and overly time consuming. Six Sigma is a proactive methodology that identifies and provides recommendations for potential problems before the company incurs any form of loss. Six Sigma may be implemented in several …

Pros and Cons of the Six Sigma Methodology Read More »

It can help anyone work toward financial goals, avoid bad debt, and save for the future. With a budget, you can move to focus your money on the things that are most important to you. Some goals to work toward may be getting out of debt, saving up for a home, or working on starting …

Why Is Budgeting Important in Business? 5 Reasons Read More »

Calculating the Present Value of multiple cash flows is actually very similar to the single cash flow case. So let’s go ahead now and step things up just a little bit by considering the case with multiple cash flows. The default calculation above asks what is the present value of a future value amount of …

Present Value Calculator, Basic Read More »

If you’re interested in shoe trends and fashion news, then flipping sneakers may be up your alley. There’s a lot involved in flipping land, including upfront investment and know-how. Check out my interview with Roberto Chavez, who was bringing in $10k a month flipping land when we recorded. Buying low and selling high is the …

How to Start a Website Flipping Business in 5 Simple Steps Read More »

Outstanding checks are those that have been written and recorded in the financial records are advertising and marketing expenses fixed or variable of the business but have not yet cleared the bank account. This often happens when the checks are written in the last few days of the month. Once you’ve identified all the items …

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A company can improve its debt ratio by cutting costs, increasing revenues, refinancing its debt at lower interest rates, improving cash flows, increasing equity financing, and restructuring. The difference between a debt ratio and a debt-to-equity ratio is that when calculating the latter, you divide total liabilities by total shareholder equity. Industries with steady cash …

Understanding Debt to Income Ratio for RV Financing: Tips for Success Read More »

There are many employers that will offer you enormous figures with minimal education or others that will appreciate your level of experience. They take a lead role in developing risk management strategies in harmony with fundamental laws and business principles of the company itself. A bachelor’s degree may be enough to get you started in …

Is An Accounting Degree Worth It? Heres What You Should Know Read More »

The positive balance is the amount seller owes to the buyers. Moreover, the seller should review the open credit memos at the end of each reporting period. It will help them to see if the customer owes money that can be linked to open accounts receivable. In accounting terms, a credit memo is a source …

What is a Credit Memo? Definition, Examples Read More »

When one company transacts with another on credit, one will record an entry to accounts payable on their books while the other records an entry to accounts receivable. Accounts payable (AP), or “payables,” refers to a company’s short-term obligations owed to its creditors or suppliers, which have not yet been paid. Effective management of accounts …

What is Accounts Payable? Definition and Example Bench Accounting Read More »

Comparing the two figures, you can see that using 13 months gave you a higher number, which more accurately considers the higher months like July and August. An efficient company has a higher accounts receivable turnover ratio while an inefficient company has a lower ratio. This metric is commonly used to compare companies within the …

Receivables Turnover Ratio: Formula, Importance, Examples, and Limitations Read More »

Run your business from anywhere with Xero’s easy accounting app. Keep track of your unpaid and overdue invoices, bank account balances, profit and loss, cash flow and bills to pay. You can even reconcile bank accounts and convert quotes to invoices. At NerdWallet UK, we base our reviews and our ‘Best’ pages on the results …

Accounting Software Do Beautiful Business Read More »