Author: John

Betterment in Accounting: What It Is, Accounting, Journal Entry, Example

Assets include resources that companies use to generate revenue. These assets may come in different forms. For most companies, fixed assets are essential in providing a base for operations. However, these differ from other assets as they may require continuous expenditure. Sometimes, this expenditure may fall under betterment. Betterment in …

Algorithmic Trading System in Python, an Example

Developing an algorithmic trading system that consistently generates profits can be a challenging task, as it requires a deep understanding of financial markets, trading strategies, and risk management. To ensure your system is successful, you must consider the following elements: data collection, analysis, and backtesting. In this blog post, we …

Effective Annual Rate: Definition, Formula, Calculation, Example, vs APR

Understanding how the annual interest affects an investment can help investors plan more effectively and make more informed decisions. The effective annual interest rate is the yearly rate of an investment that takes into account the compounding frequency and other factors such as fees or charges that may be associated …

Walter’s Model on Dividend Policy: Explanation, Formula, Assumptions

When companies generate profits, they may decide to keep the amount for future projects or distribute it among shareholders. The latter, known as dividends, come based on the dividend policy that a company follows. However, every company has a dividend policy that dictates the treatment of the profits generated during …

Debit Memo: Definition, Meaning, Example, Use in Banking, Template

Clerical errors may exist in every organization. These errors can be critical if not rectified on time. However, companies have various tools to allow them to identify and correct errors. One of these includes the debit memo. A debit memo is the opposite of a credit memo. However, it is …

Pro Rata: Definition, Meaning, Examples, Usage, Formula

Pro Rata is the Latin word for “in proportion”. It is used to describe a method of allocating or distributing items in proportion to the relative size of each item. In accounting and finance, Pro Rata calculations are used to calculate the portion of an expense that each party should …