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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.
Capital expenditures are the funds used to acquire or upgrade a company's fixed assets, such as expenditures towards property, plant, or equipment (PP&E). [3] In the case when a capital expenditure constitutes a major financial decision for a company, the expenditure must be formalized at an annual shareholders meeting or a special meeting of the Board of Directors.
Assets and expenses are two important accounting concepts elemental to understanding your company’s performance. While both assets and expenses have a debit balance on your business’s ...
In finance, the operating ratio is a company's operating expenses as a percentage of revenue.This financial ratio is most commonly used for industries which require a large percentage of revenues to maintain operations, such as railroads. [1]
A professional investor contemplating a change to the capital structure of a firm (e.g., through a leveraged buyout) first evaluates a firm's fundamental earnings potential (reflected by earnings before interest, taxes, depreciation and amortization and EBIT), and then determines the optimal use of debt versus equity (equity value).
The exact definition of these performance indicators varies between industries, but typically covers these categories: Input: Operational expenditure (OPEX), capital expenditure (CAPEX), people (measured either as headcount including headcount of partners, or as total number of full-time equivalents)
For example, $225K would be understood to mean $225,000, and $3.6K would be understood to mean $3,600. Multiple K's are not commonly used to represent larger numbers. In other words, it would look odd to use $1.2KK to represent $1,200,000. Ke – Is used as an abbreviation for Cost of Equity (COE).
The term “charge-off” can be one of those somewhat baffling terms. In this guide, we’ll discuss what credit card charge-offs are and what they mean for your credit reports and scores ...