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A not-for-profit or non-for-profit organization (NFPO) is a legal entity that does not distribute surplus funds to its members and is formed to fulfill specific objectives. [1] [2] While not-for-profit organizations and non-profit organizations (NPO) are distinct legal entities, the terms are sometimes used interchangeably. [3]
A company's earnings before interest, taxes, depreciation, and amortization (commonly abbreviated EBITDA, [1] pronounced / ˈ iː b ɪ t d ɑː,-b ə-, ˈ ɛ-/ [2]) is a measure of a company's profitability of the operating business only, thus before any effects of indebtedness, state-mandated payments, and costs required to maintain its asset base.
Program services are the mission-related activities performed by the organization. Non-program supporting services include the costs of fund-raising events, management and general administration. [20] This is a required section of the Form 990 that is an annual informational return required by the Internal Revenue Service for nonprofit ...
If the company deducts the purchase as a business expense the same year it purchased the equipment — and generated $500,000 in sales — it may show a profit of $100,000 for that year.
Organizations face a significant challenge to track the location, quantity, condition, maintenance and depreciation status of their fixed assets. A popular approach to tracking fixed assets uses serial numbered asset tags, which are labels often with bar codes for easy and accurate reading.
Depreciation is a corresponding concept for tangible assets. Methodologies for allocating amortization to each accounting period are generally the same as those for depreciation. However, many intangible assets such as goodwill or certain brands may be deemed to have an indefinite useful life and are therefore not subject to amortization ...
To accurately determine the Net Income (profit) for a period, incremental depreciation of the total value of the asset must be charged against the revenue of the same period. Doing so is necessary for determining Net Revenue. Net book value of an asset is the difference between the historical cost of that asset and its associated depreciation ...
IAS 16 applies to property, plant and equipment (PPE). The standard itself defines PPE as "tangible items that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes; and are expected to be used during more than one [accounting] period."