Having covered a number of company fundamentals that demonstrate how a company is operating (Turnover, Profitability and Leverage), this article will examine the Balance Sheet, which provides an overview of a company’s assets and liabilities, as well as the shareholders’ equity at a given point in time. Each of these sections includes many sub-accounts which […]
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Leverage, or debt as it is more commonly known, is a term that refers to money that a company has borrowed. When a company wants to invest in new assets, it needs cash to pay for them. That cash can come from one of three sources – sales and investment returns, equity capital or debt
Profit is an economic concept which occurs when the income from an economic transaction exceed the costs of carrying it out. For example, if a company sells windows that cost £500 in material and, plus £100 in labour and transportation costs, but they receive £1000 from the sale of the window, then their profit is
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Turnover is a financial term which refers to how much cash has entered a company’s bank account in a given period. In most companies, it reflects the value of its sales in that year, either of goods or services, but before costs such as salaries and taxes. Most investors like to see an increasing turnover
