What is the difference between financial forecasting and financial modeling?

July 9, 2024 No Comments

A: The difference between financial forecasting and financial modeling is that the former is the process in which a company thinks about and prepares for the future, while the latter is the act of calculating, forecasting or estimating a company’s financial numbers. Financial Forecasting When

What is the difference between fixed cost and total fixed cost?

July 9, 2024 No Comments

A: A fixed cost is a cost that remains the same and does not depend on the amount of goods and services a company produces. It is an expense that a company has to pay and is usually time-related. For example, a fixed cost would

What is the difference between forward p/e and trailing p/e?

July 9, 2024 No Comments

A: The forward P/E calculates the price-to-earnings ratio that uses projected future earnings. The trailing P/E, which is the standard form of the price-to-earnings ratio, is calculated using recent past earnings. When analysts talk about the P/E ratio, they commonly refer to the trailing P/E.

What is the difference between gross profit margin and markup?

July 9, 2024 No Comments

A: The difference between gross profit margin, or simply gross margin, and markup lies in the information each provides. Both are accounting terms used in determining metrics of profitability and may even examine the same numbers in regard to a sale or exchange of goods,

What is the difference between IAS and GAAP?

July 9, 2024 No Comments

A: To answer this question, we must first define what IAS and GAAP are, in order to get a better grasp of the function they serve in the world of accounting. The acronym “IAS” stands for International Accounting Standards. This is a set of accounting

What is the difference between interest coverage ratio and DSCR?

July 9, 2024 No Comments

A: The amount of debt a company is responsible for is an important factor when assessing its relative strength and financial stability. Whether you are the business owner, an accountant or an outside party looking at a potential investment, a company’s debt level plays a

What is the difference between linear regression and multiple regression?

July 9, 2024 No Comments

A: In statistics, linear regression models the relationship between a dependent variable and one or more explanatory variables using a linear function. If two or more explanatory variables have a linear relationship with the dependent variable, the regression is called a multiple linear regression. Multiple

What is the difference between a Sharpe ratio and an information ratio?

July 9, 2024 No Comments

A: The Sharpe ratio and the information ratio are both tools used to evaluate the risk-adjusted rate of return of an investment portfolio. They differ in the baseline against which each measures, or compares, the investment return. The Sharpe ratio is perhaps the most widely

What is the difference between deferred revenue and accrued expense?

July 9, 2024 No Comments

A: Deferred revenue is the portion of a company’s revenue that has not been earned, but cash has been collected from customers in the form of a prepayment. Accrued expenses are the expenses of a company that have been incurred but not yet paid. Under

What is the difference between a subsidiary and a sister company?

July 9, 2024 No Comments

A: The difference between a subsidiary and a sister company lies in their relationship to the parent company and to each other. A parent company is the owner of separate corporations known as subsidiaries. The parent company’s control stems from either owning the subsidiary company

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