To stay in business, your company needs to earn more than it spends, at least over the long term. A net income formula tells you whether you are earning or losing money. However, this equation only ...

A balance sheet provides a snapshot of a company's assets, liabilities and equity at a specific point in time, while an income statement summarizes its revenues and expenses over a period to show ...

A balance sheet displays what a company owns, what it owes, how it's financed, and its shareholders' equity at a particular point in time. An income statement displays the company's revenues and ...

Understanding how the income statement affects the balance sheet is not that difficult. The two concepts fit together like pieces of a dynamic puzzle. In this case, the puzzle is the financial ...

Create this important document to show investors the true net worth of your business, and to keep track of your financial trajectory. If the income sheet shows what you’re earning, the balance sheet ...

All publicly traded companies are required to release financial statements quarterly so investors can get a sense of how the business is doing. There are three main financial statements investors ...

Start by looking at cash flow from operations, the section that tells you how much money the company’s main business is actually generating. If that number is positive and growing over time, it’s ...

A vertical analysis is used to show the relative sizes of the different accounts on a financial statement. For example, when a vertical analysis is done on an income statement, it will show the top ...

Find a company's periodic interest rate by dividing interest expense by total debt and multiplying by 100. To annualize a quarterly rate, multiply the periodic interest rate by four. Use income ...

Joseph, Director at Wise Business Plans, has overseen 15K written business plans, raising over $1Bn in funding in more than 400 industries. As you create your financial projections for your business ...

Learn to calculate the dividend payout ratio from an income statement and understand its difference from the dividend yield. Simplify your investment analysis.

Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee, and has a degree in accounting and finance from DePaul University. Katrina Ávila Munichiello is an experienced editor, ...