To stay in business, your company needs to earn more than it spends, at least over the long term. A net income formula tells you whether you are earning or losing money. However, this equation only ...

Net income seems straightforward: It is the result when expenses (administrative expenses, business expenses, interest expenses, operating costs and other expenses) are subtracted from revenue. This ...

When your company makes a profit, you can issue a dividend to shareholders or keep the money. The profits you keep are called retained earnings. You can use retained earnings to fund working capital, ...

One of the benefits of understanding how the income statement and balance sheet work together is that you can figure out missing pieces of information based on numbers elsewhere in the financial ...

The balance sheet provides a look at a business at a snapshot in time, often at the end of a quarter or year. In some cases, the accounts on the balance sheet -- assets, liabilities, and equity -- can ...

Generally speaking, your return on invested capital, or ROIC, refers to the profits you receive relative to the money you've invested. For example, if you spent $100,000 to start a business and you ...

As such, it is seen as an indicator of how efficiently a company's management is deploying the economic resources it ...

A balance sheet displays what a company owns, what it owes, how it's financed, and its shareholders' equity at a particular point in time. An income statement displays the company's revenues and ...

Invested capital typically refers to a combination of shareholders' equity and long-term debt, both of which can be found on the balance sheet. Shareholders' equity is generally the last item listed, ...