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Accounting Profit is a company's sum total earnings, computed according to Generally Accepted Accounting Principles (GAAP), and involves the explicit costs of operating business, like interest, depreciation and taxes.
Accounting profits tend to be more than economic profits as they skip some implicit costs, like opportunity costs. For instance, if you invest $100,000 to establish a business and gained $120,000 in profit then your accounting profit would be $20,000. Economic profit would put in implicit costs; like the opportunity cost of $50,000 should you have been employed in its place during that particular period. As shown by this, you would have an economic loss of $30,000 i.e. $120,000 - $100,000 - $50,000).
Quick ratio Meaning: this ratio establishes a relationship among quick assets and current liabilities Objective: the objective of commuting this ratio is to calculate th
It refers to the length of time given to the buyer to pay for their purchases. Throughout this period no interest is charged on the excellent amount. The credit period usually vari
opening stock 19000 closing stock 21000 sales 200000 gross profit 25% on sales calculate stock turnover ratio
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Determine the Traditional classification a) Balance sheet or position statement ratios: balances sheet ratios deal with the relationship among two balance sheet item e.g., th
ABC Analysis (Pareto Analysis) In ordinary parlance, ABC analysis can be best compared with our class society where the population is categorized into Top, Middle and Lower cla
Explain the Organization and Control System of a Car Company? A car company along with its three product lines. Line A is planned at the luxury segment, Line B at the upscale s
GRAPHICAL METHOD Graphical methods can be used in games with no saddle points and having pay off m X 2 or 2 X n matrix. The aim is to substitute a much simpler 2 X 2 matrix for
Total inventory costs formula Total inventory costs will be as follows: Total inventory costs = Purchase price cost + carrying costs + stock-out cost + order costs. Tota
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