Accounting Guides

Asset Managemnt Ratios

Asset Management Ratios

What are Asset management Ratios? Asset management ratios are a group of metrics that show how a company manages its assets in generating revenues. They’re used to analyze how efficiently and effectively a company is using its resources by comparing the total assets with the total sales. These ratios can be used in the context …

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Conversion Cost

Conversion Cost

Conversion cost also known as cost per conversion for a certain marketing channel is an important indicator of how well a company is performing on various marketing channels. The Cost per Conversion metric can help show the ROI for an online marketing campaign, where the goal is to convert visitors into paying customers.  Conversion costs …

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Cannibalization Rate

Cannibalization Rate

What is Market Cannibalization? Cannibalization is when a firm whose product lacks an established market occupies a share of the market by undercutting its competitors. Market cannibalization has driven many firms to turn to mergers and acquisitions in order to survive. The concept of cannibalization is important to every fund accounting student because it familiarizes …

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Net Operating Assets

Net Operating Assets

What are Net Operating Assets? Net operating assets (NOA) is a measurement of the net worth of a company. It’s the value of the company’s assets minus liabilities, including stockholders’ equity and debt. In other words, net operating assets measure what’s left over after subtracting all debts and obligations from all that remains. The general …

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Substantive Audit Procedures

Substantive Audit Procedures

What are substantive procedures in auditing? Substantive audit procedures are critical in determining the level of risk and control weaknesses in an entity. A substantive audit procedures refers to audit procedures that are performed to provide a reasonable basis for evaluating whether there is a reasonable possibility that material misstatements exist due to fraud or …

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Predetermined Overhead Rate

Predetermined Overhead Rate

A predetermined overhead rate is a cost of doing business that includes costs of the fixed assets, such as property or buildings, used in manufacturing. At the beginning of the accounting period, a predetermined overhead rate is determined by dividing the predicted manufacturing overhead by the anticipated activity base. The predetermined overhead rate plays an …

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Fund Accounting Basics.

Fund Accounting Basics

What is Fund Accounting? Fund accounting refers to a system of record keeping mainly used by non-governmental organizations for purposes of accountability. Every business takes the aspect of profits seriously and thus the need for accounting; but the focus of nonprofits is on how well the available funds were used. Even though nonprofits also keep …

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