Page 237 - Finance for Non-Financial Managers

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Index
218
Prepaid expenses (Continued)
amortizing, 80
R
as current asset, 38–39 Quick ratio, 102–103
Pretax income, 62–63 Ratios. See also Formulas
financial condition and net
Price/earnings ratio, 64, 65, 101
Price variances, 135–136 worth, 101–105
financial leverage, 108–112
Principal reduction, with equip-
ment loans, 183 profitability, 105–108
Raw materials, 37
Process costing, 125, 126–127
Product development expenses, Real estate loans, 181
Receivables. See Accounts
58
receivable
Product development operating Recessions, 35
plans, 152–153
Relationships between costs,
Production, as stage of cash flow 161–162
cycle, 71
Relevance, 15, 146
Production plans, 150 Repetition, importance to
Productivity measures, 112–115
accounting, 15–16
Profit and loss statement. See Reports. See Financial reports
Income statement
Research and development,
Profits. See also Cost accounting
cash flow versus, 67–68, 74, 58–59, 152–153
Reserves, 36
76–81
dividends from, 96, 97 Retained earnings, 48–49
Return on equity, 111–112
gross, 56, 121–122
measures of, 105–108 Revenue. See also Sales
budgeting for, 157–160
retained earnings and, 48–49
transaction timing and, 52–54 profit margins on, 106–108
sales of services as, 55
Projections, 157
Revolving credit lines, 175–177,
Property, recording sales on 187
income statement, 62
Roadmaps, 140–141
Provision for income taxes, 63
Purchase order financing, S
180–181 Sales
Purchase orders, 23 accrual basis accounting, 26
of companies, 206–208
Q
cost of, 55–56, 57, 78
Questionable practices
days sales outstanding,
IBM criticized for, 60 103–104, 105
recording service contracts as
forecasting, 157–160
sales, 54 as income statement line,
by stockbrokers, 204
54–55
in timing of recording sales, 56
metrics of, 114–115