POST CLOSING TRIAL BALANCE: Definition and Importance
A business must monitor its finances and keep track of debits and credits in order to be successful.…
TIMES EARNED INTEREST RATIO (TIE Ratio): Definition, Formula and Uses
A company’s financial health can be assessed using a variety of criteria. One example is the times interest…
CONVERSION COST: Definition, Formula, and Calculations
Companies that manufacture inventory rely largely on metrics to track production and analyze the efficiency with which inventory…
BILLS OF EXCHANGE: Definition, Types, and Uses
Payments are essential in any business. However, as anyone who has chased an invoice knows, getting paid isn’t…
STANDARD COST: Definition, Benefits, and Limitations
Standard cost accounting can be a very useful technique for managers trying to build a more realistic budget.…
PRE MONEY VALUATION: Definition and How to Calculate
All VC agreements are based on pre-money values. They are the critical number on which all parties must…
INTERIM FINANCIAL STATEMENTS: How To Create The Reports(+Examples)
Your company’s financial statements are a report card on how well it is doing. Without them, you’re left…
CONTRIBUTION INCOME STATEMENT: Format and Examples
One of the processes that any business must go through is the preparation of an income statement. This…
EQUITY MULTIPLIER: Definition, Formula, and Calculations
The equity multiplier, like all liquidity and financial leverage ratios, indicates the company’s risk to creditors. Companies that…
SOLVENCY RATIO: Definition, Examples and Formulas
The solvency ratio is used to assess a company’s ability to pay its long-term liabilities, such as debt…