Creating new revenue streams is a smart business decision, but how to you assign company costs to each source of revenue? The process can be difficult, and if you don’t allocate costs in a way that makes sense, your financial results will be distorted. You won’t understand how profitable a particular business line is, […]
There’s nothing wrong with promoting a loss leader product to get customers in the door. Your grocery store does it all the time. Around July 4th, the store advertises rock-bottom prices for charcoal, hot dogs, buns, and other items for your holiday picnic. They also bundle these products into a nice display area […]
How expensive is it to carry inventory? It may be your firm’s biggest use of cash- money that you can’t use for some other purpose. One of the biggest inventory issues is the Boeing 737 Max planes, which are currently grounded. What Happened The Wall Street Journal explains that the FAA […]
Is that luxury item you purchased the genuine article? If not, you’ve overpaid by a wide margin. That’s was the scandal at The Real Real, world’s largest online consumer marketplace for luxury items. The company website states that the firm “is the leader in authenticated luxury consignment. Every items we sell is 100% […]
Why would two large companies decide to merge? In many cases, it has to do with huge changes in how both firms generate revenue and profits. As a business owner, you can use the cost-volume-profit (CVP) formula to make decisions about the direction of your business. As this great article explains, Charles Schwab […]
Some companies, such as banks, large manufacturers, and airlines, have to make a big investment in assets to operate. Delta Airlines, for example, has to lease gates and ticket counters at over 300 airports. How a business accounts for this type of spending has a big impact on company profit. This excellent article […]
Who knew that Thomas the Tank Engine could stir up so many problems? Mattel, the owner of the toy brand and PwC, Mattel’s external auditor, did not take proactive steps to correct an accounting error. The company and the auditor have paid a heavy price. This excellent article from the Wall Street […]
Under Armour’s CEO is stepping down, and the stock price declined by over 18% on Mon, 11/4. What happened? The company’s third quarter earnings report was negative, but the bigger story is this: “Department of Justice is conducting a criminal inquiry into whether Under Armour shifted sales from quarter to quarter to […]
The world is changing. Starting a business has become, and the market is becoming so crowded with people who are desperate to make it to the top. And there are some really powerful businesses at the top of the food chain, that can make a massive difference to the way that this world […]
The weighted average shares outstanding calculation is the number of common stock shares outstanding, adjusted for stock splits, stock dividends and other factors. To understand the weighted average shares outstanding example below, you need to review diluted weighted average shares outstanding. The number of shares outstanding formula also adjusts for the number of months a […]