What are the advantages and disadvantages of horizontal integration?

July 7, 2024 No Comments

A: A company that seeks to expand through a horizontal integration can achieve economies of scale, economies of scope, increased market power or market share, reduction of production costs, reduction of competition and increases in other synergies. However, a company that decides to integrate horizontally

What are the advantages and disadvantages of listing on the Nasdaq versus other stock exchanges?

July 7, 2024 No Comments

A: The primary advantages for a company of listing on the Nasdaq exchange are lower listing fees and lower minimum requirements to qualify for a listing. The fact that Nasdaq features all-electronic trading is considered an advantage by many traders as well. The main disadvantage

What are the benefits of credit ratings?

July 7, 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 the best metrics to evaluate a telecommunication company?

July 7, 2024 No Comments

A: In fundamental analysis, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), debt/equity and free cash flow are important pieces of a company’s financials. Evaluating any stock also requires specific knowledge about the company’s sector and industry, as well as knowledge of the forces that

What are the differences between absorption costing and variable costing?

July 7, 2024 No Comments

A: Absorption costing includes all costs, including fixed costs, in figuring the cost of production, while variable costing only includes the variable costs directly related to production. Companies that use variable costing keep overhead and other fixed-cost operating expenses separate from production costs. The fixed

What are the differences between amortization and impairment?

July 7, 2024 No Comments

A: Amortization and impairment both relate to the value of a company’s intangible assets, which are reported on the balance sheet. Intangible assets include goodwill, or value within the company’s name and reputation itself. Also, patents, trademarks and copyrights are given a value and reported

What are the differences between comprehensive income and other comprehensive income?

July 7, 2024 No Comments

A: In financial accounting, income is broken down in a multitude of ways, and firms have some latitude on when to recognize and report their earnings. To compensate for this, the Financial Accounting Standards Board (FASB) has firms collect and report information that helps to

What are the differences between installment sales and credit sales?

July 7, 2024 No Comments

A: Installment sales and credit sales are quite similar, in that each provides a way for goods to be delivered and payment to be deferred. The key differences are time to repay and collateral. A credit sale is a short-term payment deferral option, while an

What are the differences between operating expenses and SG&A?

July 7, 2024 No Comments

A: In many cases, the operating expenses of a company and the selling, general and administrative expenses, or SG&A, of a company represent the same thing. Other times, SG&A is listed as a subcategory of operating expenses on the income statement. Both operating expenses and

What are the differences between period costs and product costs?

July 7, 2024 No Comments

A: Costs of business are categorized as period costs or product costs as far as financial accounting is concerned. These categorizations occur on the basis of whether the expense is capitalized to the cost of saleable products. What are Product Costs? Costs incurred in the

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