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It might be questionable to assert that the cost of ten extra people on the sales force are an incremental cost or an overhead cost, since the wages for these people are both overhead and incremental. The staff needed to keep the shop operational are mostly considered overhead. formula for operating cost = total cost* number of weeks
An operating expense (opex) [a] is an ongoing cost for running a product, business, or system. [1] Its counterpart, a capital expenditure (capex), is the cost of developing or providing non-consumable parts for the product or system.
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 ...
Depreciation*(tax rate) which locates at the end of the formula is called depreciation shield through which we can see that there is a negative relation between depreciation and cash flow. Changing in net working capital: it is the cost or revenue related to the company's short-term asset like inventory.
Profit margin is calculated with selling price (or revenue) taken as base times 100. It is the percentage of selling price that is turned into profit, whereas "profit percentage" or "markup" is the percentage of cost price that one gets as profit on top of cost price.
The preferred term is now only "investment." Note that TOC recommends inventory be valued strictly on totally variable cost (TVC) associated with creating the inventory, not with additional cost allocations from overhead. Operating expense (OE) is the money the system spends in generating "goal units." For physical products, OE is all expenses ...
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An important part of standard cost accounting is a variance analysis, which breaks down the variation between actual cost and standard costs into various components (volume variation, material cost variation, labor cost variation, etc.) so managers can understand why costs were different from what was planned and take appropriate action to ...