Income Recognition

Tag: Income Recognition

Cash Flow vs Net Income

See Also: Operating Income (EBIT) Free Cash Flow Analysis Cash Flow vs Net Income What is Cash Flow? Cash flow is the blood of a business. It is the measure of what cash is coming in and what is leaving. Cash flow is a more accurate measure of whether a company has enough capital to

Read More

Cash Accounting vs Accrual Accounting

See Also: Accrual Based Accounting Generally Accepted Accounting Principles (GAAP) Cash Accounting vs Accrual Accounting There are two different types of accounting that businesses use: cash accounting vs accrual accounting. Most businesses use accrual accounting, but it varies by the type of business. These two methods are both legal and accepted by the Internal Revenue Service. The

Read More

Valuation Methods

See Also: Financial Ratios Required Rate of Return Internal Rate of Return Method EBITDA Valuation What is a Term Sheet? Adjusted EBITDA Multiple of Earnings Business Valuation Purposes Valuation Methods There are a variety of approaches to valuing a firm and its equity. Two of the most popular approaches are discounted cash flow (DCF) methods

Read More

Realized and Unrealized Gains and Losses

See Also: Accounting Income vs Economic Income Capital Gains Proforma Earnings Operating Income Net Income Asset Market Value vs Asset Book Value Realized and Unrealized Gains and Losses Explanation In accounting, there is a difference between realized and unrealized gains and losses. Realized income or losses refer to profits or losses from completed transactions. Unrealized

Read More

Operating Income (EBIT)

See Also: Operating Income Example EBITDA Definition Net Income Free Cash Flow Operating Profit Margin Ratio Time Value of Money (TVM) What is operating income? Earnings before interest and tax, also know as operating income (EBIT), is defined as a measure of a company’s profit from ordinary operations, excluding interest and tax. EBIT is also

Read More

Accounting Income vs Economic Income

See Also: Economic Income Accounting Income Definition Income Statement Operating Income Net Income Future of the Accounting Workforce Variance Analysis Accounting Income vs Economic Income Definition Accounting income or loss recognizes realized gains and losses, and does not recognize unrealized gains and losses. Economic income or loss recognizes all gains and losses, whether realized or

Read More

Accounting Income Definition

See Also: Accounting Income vs. Economic Income Accrual Based Accounting Financial Ratios Comprehensive Income Financial Accounting Standards Board (FASB) Accounting Income Definition The accounting income definition is an estimate of performance in the operations of a company. It is influenced by financing and investing decisions. Accounting income or loss generally recognizes realized gains and losses,

Read More