Companies and organizations use assets to meet their objectives. In most cases, the company and its management control how they use those assets. However, it may not be the case every time. Some organizations may also have restrictions exposed to their funds from various sources. Usually, it is more common …

Free float is an important concept for investors to understand, as it can have a significant impact on the price of a stock. Free float refers to the number of shares that are available to be bought and sold in the public markets without restriction or limitations. It is the …

Capacity utilization is a measure of the extent to which an organization or business is using its available resources, such as production capacity or personnel at any given time. It helps to determine how efficiently a company can produce goods and services about the potential it has for producing those …

A liability is obligation companies accumulate from past transactions and events. This obligation creates an economic outflow of benefits in the future. Practically, liabilities may come in various forms for a company. Two of the two common ones include account and note payable. Both are similar in many aspects. However, …

Maintaining the current position is extremely important for companies to ensure that their operations continue to run smoothly. Most importantly, it is important to identify potential risks and opportunities that exist in the current environment. To achieve that companies need strategies to manage these risks and take advantage of the …

Investors get their returns from a company in two ways. The first comes from dividends that a company distributes from its profits. However, that does not imply that the amount the company holds back from allocating as dividends doesn’t provide value. This amount falls under retained earnings and can help …

Every firm that is a FINRA member must provide its executives, employees, and other associated persons with a notice about their obligation to adhere to Rule 407 of the FINRA. This rule restricts how and when these individuals are allowed to buy or sell securities in their personal accounts. According …

An asset is a financial resource that results in an inflow of economic benefits in the future. It has a value coming from its cost or other valuation models. In accounting, assets may classify as monetary or non-monetary. It is among many classifications of resources. Due to this difference, these …

Costing is an essential part of any business. Whether it is products or services, companies must calculate the cost of their items. Once they can do so reliably, companies can use the information in various decisions. However, determining the actual product or service cost can be complex. Usually, assigning direct …

Every cost-effective business operation must have a healthy operating margin. It not only allows the company to remain financially solvent, but it also permits owners to reinvest in the business. Operating margins are an important financial metric used to measure the profitability of a company relative to its total revenue. …