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There are several potential financing options available to cash-strapped companies that need a healthy dose of working capital. A bank loan or line of credit is often the first option homeowners think of, and for businesses that qualify, this may be the best option.

In today’s uncertain business, economic and regulatory environment, qualifying for a bank loan can be difficult, especially for businesses just starting out and those that have experienced some type of financial hardship. Sometimes business owners who don’t qualify for a bank loan decide that seeking venture capital or bringing in equity investors are other viable options.

But are they really? While bringing venture capital and so-called “angel” investors into your business has some potential benefits, there are drawbacks as well. Unfortunately, homeowners sometimes don’t think about these drawbacks until the ink has dried on a deal with a venture capitalist or angel investor, and it’s too late to back out of the deal.

Different types of financing

One problem with bringing in equity investors to help provide a working capital boost is that working capital and equity are really two different types of financing.

Working capital, or money used to pay for business expenses incurred during the period of time until cash from sales (or accounts receivable) is collected, is short-term in nature, so it must be be financed through a short-term financing tool. The capital, however, must generally be used to finance rapid growth, business expansion, acquisitions, or the purchase of long-term assets, which are defined as assets that pay for themselves over more than a 12-month business cycle.

But the biggest downside to bringing equity investors into your business is a potential loss of control. When you sell equity (or shares) in your business to venture capitalists or angels, you’re giving up a percentage of ownership of your business, and you may do so at an inopportune time. With this dilution of ownership more often than not comes a loss of control over some or all of the major business decisions that need to be made.

Sometimes owners are tempted to sell shares due to the fact that there is little (if any) out-of-pocket expense. Unlike debt financing, you generally don’t pay interest with equity financing. The equity investor earns his return through the ownership interest acquired in his business. But the long-term “cost” of selling stock is always much higher than the short-term cost of debt, both in terms of the cost of actual cash and soft costs such as loss of control and management of your company and the potential future. value of the property shares being sold.

Alternative financing solutions

But what if your business needs working capital and doesn’t qualify for a bank loan or line of credit? Alternative financing solutions are usually adequate to inject working capital into companies that find themselves in this situation. Three of the most common types of alternative financing used by these types of companies are:

1. Full Service Factoring – Companies sell outstanding accounts receivable on an ongoing basis to a commercial finance (or factoring) company at a discount. The factoring company then manages the account receivable until it is paid. Factoring is a well-established and accepted method of temporary alternative financing that is especially suitable for fast-growing companies and those with concentrations of customers.

2. Financing of Accounts Receivable (A/R) – Accounts receivable financing is an ideal solution for businesses that are not yet bankable but have a stable financial condition and a more diverse customer base. Here, the company provides details about all accounts receivable and pledges those assets as collateral. Proceeds from those accounts receivable are sent to a safe deposit box while the finance company calculates a loan basis to determine how much the company can borrow. When the borrower needs money, he makes an advance request and the finance company advances the money using a percentage of the accounts receivable.

3. Asset Based Lending (ABL) – This is a line of credit secured by all of a business’s assets, which may include accounts receivable, equipment, and inventory. Unlike factoring, the company continues to manage and collect its own accounts receivable and submits collateral reports on an ongoing basis to the finance company, which will periodically review and audit the reports.

In addition to providing working capital and allowing owners to maintain control of the business, alternative financing can also provide other benefits:

• It’s easy to determine the exact cost of financing and get a raise.
• Professional collateral management may be included depending on the type of facility and the lender.
• Real-time online interactive reports are often available.
• It can provide the company with access to more capital.
• It is flexible: financing comes and goes according to the needs of the company.

It is important to note that there are some circumstances in which equity is a viable and attractive financing solution. This is especially true in cases of business expansion and acquisition and new product launches: these are capital needs that are generally not well suited to debt financing. However, equity capital is often not the right financing solution to solve a working capital problem or help close a cash flow gap.

a precious commodity

Remember that corporate wealth is a precious asset that should only be considered in the right circumstances and at the right time. When seeking equity financing, this should ideally be done at a time when the company has good growth prospects and a significant cash need for this growth. Ideally, majority ownership (and therefore outright control) should remain in the hands of the company’s founders.

Alternative financing solutions such as factoring, A/R financing, and ABL can provide the working capital that propels many cash-strapped businesses that do not qualify for the need for bank financing, without diluting ownership and possibly relinquishing ownership. control of the business at an inopportune time for the owner. As long as these businesses become bankable later, it’s often an easy transition to a traditional bank line of credit. Your banker can refer you to a commercial finance company that can offer you the right type of alternative financing solution for your unique situation.

taking the time to understand everybody The different financing options available for your business, and the pros and cons of each, is the best way to ensure you choose the best option for your business. Using alternative financing can help your business grow without diluting your ownership. After all, it’s your business, shouldn’t you keep as much as possible?

Apart from other countries, the United States has always followed its own way of doing things. For example, the US was the only country to have a uniform color for its currency; green. However, other countries color code their currency to differentiate their denominations. Our green-colored dollar bill originated in the 19th century and up until the 2000s, we are now beginning to see US bills with multi-colored ink. Until the 2000s, the United States was stuck in its own ways and comfortable with its constant green currency until they realized that printing with multicolor ink would help differentiate their notes; all while other countries recognized this much earlier. Just as the United States had its own way of presenting our currency, the same goes for setting our accounting standards. The US has followed Generally Accepted Accounting Principles, or GAAP, as a means of presenting financial statements, while other countries follow International Financial Reporting Standards, or IFRS. Historically, the United States has been the most adamant in sticking to its own US GAAP, however, recently the Securities and Exchange Commission (SEC) agreed to the adoption and enforcement of IFRS in the US. The SEC has recognized the outpaced benefits associated with the use of equivalent accounting standards among all countries despite the differences between them.

As more and more companies are making the transition to a global economy, by adopting IFRS, all companies around the world will present financial statements on the same basis and rationale. This, in turn, will give US companies a competitive advantage over their foreign competitors, as the equivalent disclosure of companies’ financial performance will be more understandable and easier to compare for investors, companies and the general public. . As Professor David Albrecht points out, “If each country has a different set of financial standards, while multinational companies exist in different countries, it is difficult to compare the position of each company because there is no consistency. Consistency is a key factor in comparison of statements. IFRS will also make it easier for companies to initiate partnerships, implement cross-border acquisitions, and develop cooperative agreements with foreign entities. In addition, companies with subsidiaries in countries that require or allow IFRS may use one accounting language throughout the company. Companies may also need to convert to IFRS if they are subsidiaries of a foreign company that is required to use IFRS, or if they have a foreign investor that is required to use the international standard. Another apparent benefit of adopting this is that companies will have the advantage of raising their capital abroad. All of these advantages, plus many others, will greatly help a company’s position and overall performance in the global economy.

Although the change to IFRS will be beneficial to US companies, some people believe the change will put the US at a disadvantage because of the many differences between our current accounting principles and IFRS. To be clear, US GAAP is a codification of how CPA firms and corporations prepare and present their income, expenses, assets, and liabilities in their financial statements. It is not a single accounting rule, rather it is the accumulation of many rules on how to account for various transactions. When preparing financial statements using GAAP, most US corporations and other business entities use the many rules for reporting business transactions based on these various GAAP rules. The rules and procedures for reporting under GAAP are complex and have been developed over a long period of time. On the other hand, IFRS are considered a “principles-based” set of standards in the sense that they set out broad rules and dictate specific treatments.

There are specific differences in the two accounting standards. According to the IFRS website, the most significant difference between US GAAP and IFRS is that IFRS provides much less general detail. For example, its guidance regarding revenue recognition is considerably less extensive than US GAAP. IFRS also contain relatively few industry-specific instructions. Also, IFRS does not allow Last In First Out (LIFO); the only acceptable method of accounting for inventory is First In, First Out (FIFO). IFRS also uses a one-step method for impairment write-downs instead of the two-step method used with US GAAP, which makes write-downs more likely. The IFRS also does not allow debt for which there has been a covenant violation to be classified as non-current unless a waiver is obtained from the lender before the balance sheet date. To point out some other differences, US GAAP acquires intangible assets recognized at fair market value. By contrast, IFRS recognize intangible assets if it is probable that they will have future economic benefit and they are measured according to their reliability. In addition, US GAAP assigns costs to individual assets, whereas the initial measurement in IFRS is simply at cost (International Financial Reporting Standards).

From a general point of view, I think that US GAAP is calibrated to handle current financial situations and that IFRS is more oriented to focus on everything, leaning more towards a better financial future. I believe that despite these differences, the United States will benefit greatly when we adopt an international set of accounting procedures. Just as the US is now following other countries on currency differentiation, I think now is the right time to follow other countries and adopt internal accounting procedures.

Why don’t companies give me feedback after my interview? Is this a question that job seekers often ask? What immediately comes to mind is the idea of ​​poor business etiquette or poor interpersonal skills on the part of the interviewer. As a job candidate, you have reached the face-to-face interview phase of the interview process. You think your interview was excellent, and once you find out that you didn’t advance to the next phase, it’s natural to wonder why. Many companies have found themselves in more legal trouble than they would like to face by providing this information to job candidates.

Let’s take a look at an example to understand how things can go wrong for the hiring company. Candidate Julie Smith had a great interview with the hiring company. The interview manager told Julie that she was really impressed with her skills and her experience. The interview ended and Julie was obviously excited because she knew that she had [smoked] the interview. A week goes by and Julie hasn’t heard from the company and she wants to know whether or not she is advancing to the next phase of interviews. Julie was resourceful and she was able to locate the interview managers contact information. She called the manager and was told that another candidate had been selected for the position. Feeling rejected but realizing that she did the best she could, Julie asked; “Can you provide feedback on what I can do in future interviews to improve my candidacy?” The hiring manager said that he “needs to gain more experience to be considered for this job.” Stop! Why don’t companies give me feedback after my interview?

This is where the problem starts. Looking back on the interview, the hiring manager’s response to Julie was that she was really impressed with her skills and experience. So at what point did her experience become a problem? Julie gets into a lively discussion about what he shared with her during the interview. The Manager ends the discussion. These are the murky waters that companies don’t want to get into.

There are a myriad of reasons why candidates do not advance to the next phase of the interview process. Hiring managers should never provide candidates with areas for improvement or what they need to do to improve their candidacy. So if a candidate made those improvements and came back in a year, would you hire them? If you can’t answer yes, you shouldn’t tell a job candidate. The hiring manager’s job is to interview the most well-behaved and motivated candidates with the qualifications that are best suited for the job.

The candidate for the position must understand after an interview that he has done the best that he can do during this interview. The fact that the company has chosen another candidate is disappointing, but irrelevant at this point. You should see it this way; the company didn’t say NO to you as much as they said YES to someone else. So what should you do to improve your chances of landing your dream job?

1. Be sure to read the job description and only apply for jobs that you are extremely qualified for
2. Your value proposition statement should be at the top of your resume
3. Show you care by doing your homework and learn all about the company, its culture, and its competitors.
4. Develop a 30-60-90 day plan that you share during your interview
5. Dress professional and show confidence.
6. write a thank you letter [in advance] before leaving the hotel or office and drop off at the reception for the manager. You can fill in the name part after the interview.

If a company is genuinely interested in you, they will contact you within 1-2 days. They wouldn’t want to risk losing a future superstar or having you take a job with one of their competitors.

So you ask: Why don’t companies give me feedback after my interview? If a company hires good managers and HR professionals, you can expect a courtesy thank you letter within 2-3 weeks. This is after they have extended a job offer of their choosing and that person has accepted the offer in writing. No additional follow up is needed as you have done all you can do.

Stay positive and tenacious in your job search efforts. The best is yet to come.

If you want to lose weight quickly, you need to change your lifestyle. Get motivated at the beginning and launch a 10-day challenge. At first, you need to choose an effective weight loss program for yourself. And the following steps will help you move forward.

1. Moderate exercise: If you don’t have high blood pressure, get up early in the morning, stretch your body, and then go for a 15-minute walk. This is for the first day, you need to increase 10-15 minutes for the following days.

2. Drink a lot of water according to your body weight. We think that 6 to 8 glasses of water is enough for us. In fact, it depends on the individual body weight. Suppose your weight is 140 lbs, divide your weight by 2. That will be 70. And you need to drink a minimum of 70 ounces of water every day.

3. For the first day, eat only fresh fruits that contain a high amount of antioxidants like orange, lemon and other fruits.

4. You can drink juice, tea or coffee, but it must be without sugar.

5. For the second and third day eat only vegetables. Add broccoli, cucumber, spinach, eggplant.

6. For the fourth and fifth day, along with vegetables, drink two glasses of milk, one in the morning and one in the evening.

7. On the sixth and seventh day you can have low-fat yogurt, beans, an egg, two 250-gram pasta with tomato sauce and plenty of water and unsweetened juice.

8. On the eighth and ninth day you can have vegetable soup and two slices of any type of fish. But remember; don’t go for the processed soup as they have hidden calories.

9. On the tenth day you can choose any of the above programs again.

10. In these 10 days you have to develop a healthy sleep habit. When we sleep our body repairs itself. If you don’t get enough sleep, you won’t lose weight.

With all these 10 steps, you need to make sure you don’t eat junk, fast, or processed food. It is also necessary to avoid all kinds of drinks and soft drinks. Avoid salty foods.

So don’t think when should I start? She walks on and begins to get you on the path of weight loss.

When a small business needs financing, who does it turn to? There are many ways for a small business to obtain financing, each with its own unique advantages. While one may be good for a particular business, another may be more suitable for the next business. It all depends on the preferences of the small business and whether or not it will be approved. For small business owners looking to move up in the world, check out this list of sources to get capital fast.

1. Banks

This is probably the first thing someone thinks of when it comes to loans. After all, lending money to customers and charging interest is one of the ways banks make their profits. It’s usually pretty easy to get approved with a good credit score. However, as just said, banks make money on interest. Therefore, interest rates on traditional bank loans tend to be a bit higher than those from other sources, although it varies with the market rate and the applicant’s credit rating.

2. Merchant Cash Advance

Although similar to a bank loan, a merchant cash advance is usually safer and earns less interest. First of all, getting approved by a company like Water Street Capital is a much easier process than through a bank. As long as the business earns an average of $10,000 a month, you can confidently start applying for up to $500,000! The application can be submitted online and it usually takes around 3 business days to receive the money, however the company can use the money for a variety of different needs such as advertising, payroll, expansions, upgrades and more. .

The way the customer repays the loan is also fundamentally different, making this one of the best options for small businesses. The business agrees with the lender to repay the loan with a small percentage of its sales each month (as taxes). The amount is automatically withdrawn every month and varies depending on the success of the business. If you have a slow month, you pay less, and if you enjoy more profit, you’ll pay off debt faster!

3. fundraising

While it can’t really be labeled a “trustworthy” source, crowdfunding has exploded in popularity in recent years with sites like Indiegogo and GoFundMe. It can be a great way to gain investors for a small business looking to expand. If the product is popular or unique enough, it will surely get sponsors. However, it cannot always be counted on to arrive. If the company does not receive enough investment to meet its minimum goal, it receives nothing. It’s not the go-to source for large financial requests, but it has proven effective in the past, sometimes with businesses even making millions of dollars!

As Samsung releases new and trendy phones day by day, the demand for its phones is also increasing. In the month of September 2010 Samsung Galaxy Tab has been launched in the market which is available through all the offers. It is a new Android tabloid phone from the Samsung family. It offers several impressive and high-tech features. If you don’t know which multimedia phone to buy, this may be your right choice.

This is an android phone and it is powered by ARM Cortex A8 processor which supports 2g and 3g network. This amazing phone has dimensions of 190.1 x 120.5 x 12 mm and weighs 380. It packs a 7.0 inch TFT capacitive touch screen that is featured with Gorilla Glass display, TouchWiz user interface, multi-touch input method, Accelerometer sensor for UI autorotation, three axis gyro sensor, touch sensitive controls, proximity sensor for auto power off, Swype text input. High data storage can be carried out in its internal memory of 16 and 32 GB and it also allows you to increase its capacity with a micro SD card of up to 32 GB.

This phone is facilitated with GPRS, EDGE, WLAN, 3G and data transfer can be done via bluetooth. If you are crazy about taking pictures, it also offers a 3.15 MP camera with high resolution of 2048×1536 pixels. It also features auto focus, LED flash, geotagging that can enhance your images. It is available in Black and Gray color. Some more attractive features are Readers/Media/Music Hub, Adobe Flash 10.1 support, Thinkfree Office (Word, Excel, PowerPoint, PDF), etc.

Among various deals, Samsung Galaxy Tab contract deals provide its users with numerous benefits in the form of free gifts like TV, Laptop, Home Appliances, Play Stations etc. and incentives like free talk time, free text messages, etc. But to take advantage of this, you must sign a contract for 20 or 24 months. If you don’t want to sign any contract, you can buy this phone through pay as you go offer and no SIM card offer. Just visit some online mobile store and grab the best one according to your needs.

There are several factors that are typically considered when a credit team is reviewing a business profile to issue a deny or approve decision to finance equipment or provide working capital. There is some flexibility among lenders in considering different factors, but there is a common ground from which many work. Lenders with tighter, more stringent guidelines are typically the ones offering the lowest rates, so they have a narrower risk profile for each decision. More flexible lenders, meaning those who can work with higher-risk customers, have higher rates; they win some, they lose some (customer default) but they get to keep their ROI profit margin.

The following are the basic factors to look out for so you know where you fall and if there are too many red flags then you may decide not to apply for funding and go in a different direction. Learning and preparing ahead of time will help you understand the process so that at the end of the day you don’t give up and say, “Why didn’t I get approved?” These are just general guidelines and exceptions can be made, but they will always need to minimize the risk to the lender in some way.

Factor 1: Time in business. This is the easiest to verify since the secretary of state where you live will have the business file on file; he must check and make sure he is in good standing and active. Less than two years puts you in the ‘startup’ business category, which means rates will be higher and the amount you can finance will be capped at $30K, $50K, or $100K depending on the other factors. Two to five years in business is the midrange and still requires the owner’s personal guarantee and more than five years in business is the ‘established’ category and can be approved without an owner guarantee with loan amounts limited only by the business performance.

Factor 2: Personal credit. For businesses that have to personally guarantee, the owner’s credit rating is very important; particularly the younger the business. Low, damaged, or poor scores indicate how the owner could operate his or her business and is a strong indicator of success or failure and possible default. If your credit is troubled, a credit repair service should be the first step before applying for any financing. Most credit repairs take at least three to six months.

Factor 3: Cash flow. Bank balances in your business account, personal account, and savings must be adequate to pay off the new debt along with sufficient protection for emergencies. If you deposit $1000 and spend $1000, then there are no reserves for emergencies or new debt, even if the new equipment will make you a lot of money. Underwriters are looking for cash inflows and reserves that can cover business slowdowns, emergencies, etc. The amount needed will depend on the amount you want to finance.

Factor 4: comparable lending experience. Credit seeks to see what you have financed in the past; For newer businesses, your personal loan will come into play. Car loans, home loans, credit cards, and the like will be important to see how they have managed. As a business ages, you’ll want to make sure you finance even small pieces of equipment and take out business credit cards to help establish business credit history. Some vendors offer financing for small tools, and even if you can pay cash, you should finance it to help build your profile. In the long run, comparable credit becomes very important and, for many lenders, a necessity.

Factor 5: Commercial credit. Dun & Bradstreet and Paydex are common offices underwriters use to check trade history. These reports reveal lawsuits, ties, pending lawsuits, and a history of late payments. You should request a copy and work to rectify any issues and if an agreement is being worked on then a letter of validation should be filed. Credit will always consider a good story to support any problem, as long as you have solid documentation. Open links need to be worked on and resolved as very few lenders will approve any business with open links.

There are many other factors that a credit analyst will consider, but these five are the backbone of most credit decisions. You don’t have to be optimal on all five to get approved, but at least two of the five must be strong. Otherwise, some lenders will allow a family member to sign as a guarantor for the loan, which is typically a last resort for business owners. A cosigner might allow you to get approved, but you’ll still fall into a higher risk, higher rate category. In general, he should assess where he qualifies, fix what he can, and if he decides to move forward with the funding request, at least he’ll be better prepared for the outcome.

Ask anyone who knows what the top name in Network Marketing is and the only way you’ll get an answer other than Eric Worre is if you ask Eric Worre himself.

For over a quarter of a century, Eric Worre has positioned himself in the right place at the right time, leading to his current status as the world’s most knowledgeable and professional network marketing expert.

Of course, you’ve heard things like this before. You’ve heard that someone is “the best” and the term is used so loosely in blogs and articles that it has taken the form of a meaningless buzzword.

But what if I told you that Eric Worre’s sales organization reaches over 60 countries around the world, has over half a million distributors, and generates over $15 million in revenue? Would you begin to agree that he is the true “Guru” of network marketing? Everyone else too.

hard beginnings

Of course, most good success stories start with a struggle or a dream and Eric was no different. Entering college with a dream of professional soccer in mind, a career-ending injury put those dreams on permanent hiatus. This led him to drop out of college and work a wide range of jobs that got him nowhere quickly.

Dismayed with the workforce and its opportunities, Worre took a position with his father’s real estate company, where it further failed. In fact, his first year as his agent saw him tens of thousands of dollars in the red! To say that the beginning of his working career was a flop is an understatement.

Learning life lessons from failure

As is so often the case, failure taught Eric some vital business lessons about opportunities and working hard to seize them when they knocked on the door. His work ethic did not diminish, but rather he was improved by his struggles from the beginning and after being invited to the National Safety Associates marketing presentation by his mother and business partner, Eric finally found the niche of him

This is where he first heard about network marketing and seeing the opportunity others missed, he quickly got to work. His experiences, life lessons and his work ethic gave him a winning trifecta that saw Eric earn $7,500 during his first month in Network Marketing. This number continued to increase in the following months.

Eric learned so much about losing money during his early days that instead of spending it on the typical things a first-time earner normally does, he took almost every penny he made and reinvested it in his business. This meant that he lived on a very small budget, $5 an hour to be exact. But that didn’t matter. Worre knew that the sacrifice he was making now would soon turn into something much bigger and more lucrative.

The success of Eric Worre

He knew that self-discipline and control would lead him to a much more rewarding future where money would never be an issue again if he buckled up now and kept his nose to the grindstone. Within a few years, Worre’s vision came true as he began earning six figures each year.

As other people and companies began to take notice of Eric, Worre began to take notice of them. He did the math for him and mapped out his business strategy, packaging it in a way that he could sell himself. When the time was right, he sold his business strategy for millions of dollars and could have retired to some island and lived happily ever after.

But, Eric Worre still wanted more and not only that, he still had more to give to the world of network marketing and business. He worked at different companies for a while to gain experience, and eventually Worre founded a television network called TPN (The Peoples Network) that focused on personal development.

So what is Eric Worre up to now?

Today, Eric Worre brings his talents to the motivational speaking circuit as he develops Network Marketing Pro, his professional Network Marketing consulting firm. Attending an Eric Worre workshop is considered a “must do” for anyone looking to succeed in the world of network marketing. With over 250,000 trained by Eric Worre, the results are here: Eric Worre is the best network marketing expert in the game today.

If you’re like me, I’m pretty sure seeing the word “free” makes you feel something.

How many of us have ever dreamed of entering the Ellen Degeneres 12 Days of Sweepstakes over the holiday season? What about Oprah’s favorite things? Overwhelmingly, people seem to go all out and are almost willing to sell their firstborn son for something for free. I’m a regular on cruises all year long and nothing excites me more than getting something for free in a contest or just for getting on the ship, even though I know I’ll never use the item. Truly, free feels good. Why would that be any different in the realm of the psychic?

In my experience as a psychic, I have found that people enjoy the opportunity to ask a free psychic question or get a free psychic reading. The offer is quite tempting: Potentially find out something about your future that you might not otherwise have known, that may catch you off guard or even surprise you. All this without personal investment on your part. In fact, I have no problem giving someone a free reading.

However, my policy regarding free readings and free psychic questions may be a little different than others. I’m absolutely going to do them with the understanding that what I’m going to give you is going to be pretty succinct and not crammed with a ton of detail. I tend to trade this day as a matter of principle and fairness. There are those who choose to do paid readings with me, and frankly, it would be more than a little shady to give a person who asks for a free psychic question an answer with the same level of attention or detail that I give to those who choose to do so. paid readings.

I also understand that there are people whose sole purpose in a free psychic question is to test the accuracy of their chosen psychic before they choose to invest monetarily in the psychic. This is one of the main reasons why many of my contemporaries tend to avoid doing free psychic readings and questions. Many find these tests insulting or like they are being used and I understand where my colleagues are coming from; this method can be unpleasant. I am of the school of thought that as long as the psychic’s time is respected and not taken advantage of, a free psychic question is harmless. After all, we test drive vehicles before we buy them.

All this said, doing readings for free or otherwise is always an investment of time and energy on your psychic’s part, so you should always be in a position to tip your psychic for nothing more than the time and energy they spend. invested in doing a reading for you.

There are those among us who do readings as a business opportunity and there is nothing wrong with that. This is a gift and just like singers and other artists get paid to share their gift, your psychic should also be compensated in some way whether they give you a free psychic question or not.

Feel hurt and be fair.

Understanding activity indices is a very important tool for evaluating a company’s performance. Whether you are interpreting your company’s financial ratios or evaluating another company, it is essential to understand what activity ratios indicate about a company’s performance. Activity ratios are often called efficiency ratios because they measure how efficiently a company manages its assets. Activity indices can be divided into two categories; turnover rates and days available rates.

Accounts Receivable Ratios

Accounts Receivable Turnover = Net Sales ÷ Net Accounts Receivable

The accounts receivable turnover ratio measures how many times, on average, accounts receivable are collected in cash, or “draws,” during the fiscal year.

Accounts Receivable Days Available = Net Accounts Receivable ÷ Net Sales X365

Accounts Receivable Days Available (ARDOH) is the average number of days it takes to convert accounts receivable into cash. Days available for accounts receivable measures a company’s ability to collect from its customers. This number should be compared with the credit terms established by the company. By comparing this number to previous years, we can determine if there is an identifiable trend in accounts receivable. An increase in ARDOH could mean that the company has increased credit terms in an attempt to increase sales or mismanage accounts receivable. As a general rule of thumb, the acceptable upper limit for a company’s average collection period should be 50% more than stated terms. For example, if a company has established terms of 30 days, the upper limit would be 45 days. Anything longer than 45 days would be cause for concern. If the available A/R days are lower than the stated terms, the company is doing an excellent job of collecting the receivables. If available A/R days are above stated credit terms, management may need to adjust credit to reduce receivables.

The A/R days available ratio is extremely important because it allows us to put a company’s accounts receivable balance into perspective from the balance sheet. If a company has $1,000,000 in accounts receivable, that looks good just by taking a look at the balance sheet, however, if we find that the days of accounts receivable are well above the company’s established credit terms, we should be asking how much of that $1,000,000 is actually collectible. In this case, you would like to look at the age of the accounts receivable to determine how much is likely to be uncollectible.

inventory ratios

Inventory Turnover = Cost of Goods Sold ÷ Inventory

Inventory turnover measures how many times, on average, inventory is sold during the year.

Days of inventory available = Inventory ÷ Cost of goods sold X 365

Inventory days available measures how many days of inventory a company has available at any given time. Days of inventory available should be compared to prior years to determine trends affecting inventory and the industry average. Too high a number could indicate poor inventory management or an outdated, unsaleable, or expired inventor. For example, if a company’s days of inventory on hand are 70 days in year 1 and it experiences a jump to 90 days in year 2, the company needs to understand why there was a large jump in days of inventory on hand. There can be many likely reasons for the slowdown, such as increased inventory in anticipation of future shortages, obsolete or expired inventory, or poor inventory management. However, if 90 days is the industry average, the jump may not be a major concern. It would be necessary to question management to help understand why the days of inventory available changed.

Accounts Payable Ratios

Accounts Payable Turnover = Cost of Goods Sold ÷ Accounts payable

Accounts payable turnover ratios measure how many times, on average, accounts receivable are cashed out, inventory is sold, and accounts payable are paid during the year.

Accounts Payable Days Available = Accounts Payable ÷ Cost of goods sold X 365

Accounts Payable Days Available is the average number of days it takes to pay cash. This relationship gives an idea of ​​a company’s payment pattern. This must be measured against the terms offered to a company by its suppliers. If the number is higher than the terms offered by the providers, it may be cause for concern because the providers may require cash on delivery. However, a low number of available days of accounts payable increases the operating cycle and may cause the need for external financing.

operating cycle

Another useful tool to evaluate the efficiency of a company is the calculation of the operating cycle.

Operating Cycle = A/R Available Days + Inventory Available Days – A/P Available Days

It is important to understand the relationship these three ratios have in affecting a company’s cash flow. The operating cycle is determined by adding the available days of A/R and the available days of inventory and subtracting the available days of A/P. Simply put, the operating cycle is the amount of time it takes for a business to buy and manufacture goods, pay for the goods, sell the goods, and receive cash for the items sold. If a company experiences an increase in A/R days available or inventory days available, while A/P days available remain constant, its need for external financing will increase.

Understanding activity indices is essential to assess a company’s performance and efficiency. It is important to understand how a change in A/R days available, inventory days available, and A/P days can affect a company’s operating cycle. Business owners, managers, and investors can benefit from a solid understanding of activity indices.