What are some examples of just in time (JIT) inventory processes?

July 9, 2024 No Comments

A: Examples of just in time, or JIT, inventory processes are found in automobile manufacturing, drop shipping retailers, fast food restaurant production and on-demand publishing. The JIT inventory system was popularized by Toyota Motor Company in the 1970s. It is an alternative to the more

What are the benefits of credit ratings?

July 9, 2024 No Comments

A: Credit ratings are an important tool for borrowers to gain access to loans and credit cards. Good credit ratings allow people to easily borrow money from financial institutions or public debt markets. At the consumer level, banks will usually base the terms of a

What are some examples of overhead treatment in cost accounting?

July 9, 2024 No Comments

A: Typical examples of overhead in cost accounting include indirect labor, indirect materials, utilities and depreciation. A large number of overhead categories center around manufacturing, such as the expenses incurred to set up equipment, inspect products, clean factories or perform record-keeping. Defining Overhead Put simply,

What are some examples of preferred stock, and why do companies issue it?

July 9, 2024 No Comments

A: There are several reasons why a company chooses to offer preferred stock, all of which relate to the financial advantages that it provides. Companies offering preferred stock include Bank of America, Georgia Power Company and MetLife. Preferred stock derives its name from the fact

What are some examples of risk management techniques?

July 9, 2024 No Comments

A: Business risk comes in a variety of tangible and intangible forms over the course of the business life cycle. Some risks occur during the ordinary course of business operations, while others are due to extraordinary circumstances that are not easily identified. Regardless of a

What are some examples of successfully executed leveraged buyouts?

July 9, 2024 No Comments

A: In finance, a buyout refers to the purchase of a company’s voting stock in which the acquiring party gains control of the target company. A buyout can be funded with a combination of cash or debt. Buyouts that are disproportionately funded with debt are

What are some examples of the main types of capital expenditures (CAPEX)?

July 9, 2024 No Comments

A: A capital expenditure (CAPEX) is the expenditure of funds or assumption of a liability in order to obtain physical assets that are to be used for productive purposes for at least one year. Depreciation is used to expense the fixed asset over its useful

What are some important financial ratios to evaluate with respect to consumer packaged goods?

July 9, 2024 No Comments

A: Since companies that sell consumer packaged goods are traditionally low-margin, high-volume businesses, the most important financial ratios used to evaluate companies in the consumer packaged goods industry are the activity ratios. In addition, to ensure that the company is successful in the long term,

What are some of the advantages and disadvantages of absorption costing?

July 9, 2024 No Comments

A: Companies must choose between using absorption costing or variable costing in their accounting systems. There are advantages and disadvantages with either choice. Some of the primary advantages of absorption costing are the fact that it recognizes all of the costs involved in production (including

What are some of the limitations and drawbacks of using a payback period for analysis?

July 9, 2024 No Comments

A: Limitations, or disadvantages, of using the payback period method in capital budgeting include the fact that it fails to take into account the time value of money and does not factor in the value of additional cash flows beyond the payback period. Capital budgeting

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