A high DSO number means that it’s taking longer than you expected to collect cash from customers. However, by comparing a company’s DSO with other companies in the same sector, it may be possible to draw some conclusions about the company’s cash flow and working capital performance. It is used for the estimation of the average […]
Category Archives: Bookkeeping
While a full charge bookkeeper and an accountant work closely with financial data, they serve divergent roles in an organization. These distinctions become apparent when we delve into their responsibilities, education, and contribution to strategic decision-making. Small business owners are typically experts in their field or industry but might need more financial expertise to keep […]
For example, public companies are required by law to use Generally Accepted Accounting Principles (GAAP), while private companies may use any accounting method that suits their needs. Accounting is governed by established standards that ensure consistency and comparability across organizations. In most countries, companies follow either Generally Accepted Accounting Principles (GAAP) or International Financial Reporting […]
It provides one way to show the profit potential of a particular product offered by a company and shows the portion of sales that helps to cover the company’s fixed costs. Any remaining revenue left after covering fixed costs is the profit generated. The contribution margin measures how efficiently a company can produce products and […]