Recent Posts by EVELYN IVY

Be careful of accounting definitions The accounting definition of working capital = current assets – current liabilities. On the surface this has very little meaning. Current assets & liabilities could contain items that is not related to operations. Know your numbers so you know your business Working capital: Internal Vs External Working capital is used to evaluate the efficiency of cash management in meeting the demands of the direct cost of goods/

Do you know what your AR is costing you?   Why accounts receivable? Increase sales. Downside of Accounts Receivable Bad debt Opportunity cost of cash Additional staff required to maintain accounts Interest cost if business has to take loan to meet working capital needs Background checks/ collection services Office supplies like paper and ink sent to customers who owe Credit card and accounts receivable When you offer your customers the

To truly understand return on assets, you must first be able to differentiate between operating and non-operating assets. Operating Assets Operating assets are economic resources owned by the owners of the business. Operating assets are bought to generate future revenue and can usually be converted to cash in the future. This means they can potentially be resold after use. Operating assets often include: Cash – at a minimum your must have

Margin management attempts to manage risk by evaluating both cost and revenue simultaneously rather than as individual units of risks.  Margin management involves the management of revenue, expenses and taxes all simultaneously. Looking at each factor in isolation does not always yield the most margin effective decision. For example, you could have a strategy that raises revenue by $5, cost $3 to obtain and after-tax effect will leave you with $2.55. By thinking

As a Certified Public Accountant I often encounter the question should I become a s-corporation or LLC? What are the advantages of LLC? Even though I understand why people ask the LLC or S Corp question, I realize the information is based on incomplete knowledge. You can be a straight s-corporation or a LLC taxed as a s-corporation. Which one is most beneficial depends on your unique situation. S Corporation