Guides

Net income, sometimes called net profit or net earnings, is a key financial metric that represents the total earnings of an individual or business after all expenses h...

A trial balance is a fundamental financial report that lists the balances of all general ledger accounts of a business at a specific point in time. It serves as a prel...

A general ledger is a crucial accounting tool that tracks and organizes all of a business’s financial transactions. It provides a comprehensive overview of a com...

Double-entry bookkeeping is a foundational accounting system that forms the backbone of modern financial record-keeping. This method requires every financial transacti...

Cash basis accounting is a straightforward accounting method that recognizes revenues and expenses only when cash is exchanged. This means that income is recorded when...

Accrual accounting records revenues and expenses when they are earned or incurred. This happens regardless of when cash transactions occur. It provides a more accurate...

Current assets are a fundamental component of a company’s balance sheet, representing the short-term resources that a business owns and expects to convert into c...

Fixed assets are a crucial component of any business’s financial structure, representing long-term tangible property or equipment that a company uses in its oper...

Managing finances is crucial for any business, and accounts payable (AP) is a key component of this process. AP represents the money a business owes to its suppliers o...

Imagine running a business where you sell products or services, but instead of receiving immediate payment, you extend credit to your customers. This is where accounts...

Equity is a term that often comes up in finance and investing. But what does it really mean? At its core, equity is about ownership. Whether it’s owning a piece ...

Working capital is a vital financial metric that represents the difference between a company’s current assets and current liabilities. It is an essential indicat...

A cash flow statement is one of the essential financial statements that provide insight into a company’s cash inflows and outflows over a specific period, typica...

The Income Statement is a cornerstone of financial reporting, offering an in-depth look at a company’s profitability over a specific period. It’s one of the three fund...

A balance sheet is a fundamental financial statement that provides a snapshot of a company’s financial position at a specific point in time. It is essential to u...

In today’s interconnected world, where businesses operate across borders and investors seek opportunities globally, the need for a standardized financial reporting fra...

Generally Accepted Accounting Principles (GAAP) are a set of standardized guidelines and rules for financial accounting and reporting in the United States. Developed t...

Depreciation is a fundamental concept in accounting and finance, playing a crucial role in the management of a business’s financial statements. It allows busines...

Vertical analysis is a fundamental tool in accounting, offering valuable insights into a company’s financial statements by expressing each line item as a percentage of...

Horizontal analysis is a fundamental technique in financial analysis, used to evaluate trends in a company’s financial performance over a specific period. By com...

Recurring revenue metrics, such as Monthly Recurring Revenue (MRR) and Annual Recurring Revenue (ARR), are critical for businesses, especially those operating under su...

For SaaS companies, understanding Average Revenue Per User (ARPU) is more than just a metric it’s a strategic tool that reveals the revenue potential and profita...

Understanding the financial health of a business goes beyond just looking at revenue figures; it’s about delving into the intricacies of expenses that directly i...

Imagine paying off a major loan without ever feeling the financial pinch, this is the power of amortization. But how exactly does it work, and why is it a cornerstone ...

Picture this: You’re running a lemonade stand. The lemons, sugar, and cups? That’s your COGS. The flashy sign and the allowance you pay your little sister ...

Amortization is a crucial concept in finance and accounting, but it can often seem complex. Whether you’re managing business finances or personal investments, un...

When it comes to managing finances, businesses often face the daunting task of handling big expenditures and their gradual impact on the bottom line. Two essential con...

Ever wondered how investors, managers, and creditors make informed decisions about a company’s financial health? The secret lies in ratio analysis. A powerful to...

Imagine having the power to predict your business’s future success by simply mastering these two metrics. CAC tells you how much you’re spending to bring e...

The churn rate is a metric that measures the percentage of customers who discontinue their subscriptions or services with a company over a specific period, typically m...

A perpetual inventory system is an advanced inventory management method that continuously tracks inventory levels in real time. This system updates inventory records a...

Effective inventory management is the backbone of any successful business, ensuring that products are available to meet customer demand while minimizing costs. Invento...

Monthly Recurring Revenue (MRR) is a crucial financial metric for subscription-based businesses, particularly in the Software as a Service (SaaS) industry. It represen...