Comparing any two entities, may it be two different sportsmen like Michael Jordan and Lionel Messi or two different companies like Apple and GE, is always very difficult because there is no common structure to compare them. It is comparatively a bit easier to compare sportsmen or companies within the same category as comparing Ronaldo …
Continue reading Whenever there is no positive correlation between EBITDA and FCF, always trust FCF.
A capitalized cost is an expense that is added to the cost basis a fixed asset on a company's balance sheet. Capitalized costs are incurred when building or financing fixed assets. Capitalized costs are not expensed in the period they were incurred but recognized over a period of time via depreciation or amortization. A fixed …
Continue reading Whether to Expense or Capitalize An Expenditure
Balance Sheet of a Company: A balance sheet gives the picture of assets and liabilities of the company as on the last minute of 31st March YYYY. So, many times the balance sheet of a company appears better than what it is in real. Sometimes, companies will request all debtors to clear the outstandings just …
Profit and Loss Account Statement (P&L Statement): 1. Profit = Sales - Costs 2. So, you basically have two entities: Sales and Costs. The other names used to refer to Sales are: Fees, Income, Sales, Revenue, and Turnover. The other names used to refer to Costs are: Expenditure. 3. Classification of Costs or …
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