Debt to Equity Ratio
A leverage ratio used to evaluate the financial integrity of a business is the debt to equity ratio. It is strictly a bottom half balance sheet ratio.
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Value Investing
Value investing is a systematic process of purchasing high quality, intrinsic backed stocks at depressed market prices. Using financial analytics, allow time for market price recovery and then proceed to reap gains from an investor’s patience.
Net Profit Margin
The net profit margin reflects the profitability of the company as a percentage of net sales. It is one of the performance ratios used in evaluating business.
Return on Assets
Return on assets is one of the performance ratios used in business identifies the overall ability of management to efficiently utilize resources to generate a profit.
Break-Even Analysis – Fundamentals
Break-even analysis is a managerial (cost) accounting tool used to examine the relationship of price to cost of a product. It also considers various sales volumes and the effect on profit given the different relationships of price to cost.
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Accounts Payable Turnover Rate (Ratio)
The accounts payable turnover rate is a business activity ratio measuring the frequency of the company’s ability to pay its vendors and suppliers. The numerical value is customarily reported as an annual value. The higher the number, the more often the payables are cleared (paid). A ’12’ would indicate that all payables are paid every month (360 days/12 = 30 days). Ideal values exceed 20 as this indicates all accounts are paid on average at least every 18 days (360 days/20 = 18 days).
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Inventory Turnover Rate
One of the many ratios used in business, the inventory turnover rate is often misunderstood, miscalculated and misused.
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Fixed Assets To Debt Relationship
Every business owner, especially young entrepreneurs, must understand how long-term debt is used to finance the purchase of fixed assets.
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Penny Stocks- Introduction
Those small publicly traded businesses with share prices of less than $5 and capitalization of less than $50 million are referred to as penny stocks.
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Gross, Operational and Net Profit (Differences)
The word ‘Profit’ is used loosely in the business world. Profit refers to the amount earned net of costs in a transaction. The key is defining a transaction.
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Hospitality Industry Characterized by High Fixed Costs
There is one unique financial characteristic that is synonymous with the hospitality industry; that is high fixed costs. Or another way of stating the same financial attribute is to simply state that the hospitality industry has low variable costs.
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