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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.
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).
Generally Accepted Accounting Principles (GAAP) [a] is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC), [1] and is the default accounting standard used by companies based in the United States.
Historical Cost Accounting, i.e., financial capital maintenance in nominal monetary units, is based on the stable measuring unit assumption under which accountants simply assume that money, the monetary unit of measure, is perfectly stable in real value for the purpose of measuring (1) monetary items not inflation-indexed daily in terms of the ...
The general ledger is usually divided into at least seven main categories: assets, liabilities, owner's equity, revenue, expenses, gains and losses. [6] It is the system of record for an organization’s financial transactions. [7]
In financial accounting, a balance sheet (also known as statement of financial position or statement of financial condition) is a summary of the financial balances of an individual or organization, whether it be a sole proprietorship, a business partnership, a corporation, private limited company or other organization such as government or not-for-profit entity.
A chart of accounts (COA) is a list of financial accounts and reference numbers, grouped into categories, such as assets, liabilities, equity, revenue and expenses, and used for recording transactions in the organization's general ledger. Accounts may be associated with an identifier (account number) and a caption or header and are coded by ...
Cash and cash equivalents – it is the most liquid asset, which includes currency, deposit accounts, and negotiable instruments (e.g., money orders, cheque, bank drafts). Short-term investments – include securities bought and held for sale in the near future to generate income on short-term price differences (trading securities)