Fixed vs. Variable Costs: What They Are and How to Tell Them Apart
Fixed costs stay the same regardless of sales; variable costs change with output. See examples, break-even analysis, and pricing tips.
#profitability
Profitability
Analyze and improve business profitability with financial insights
Gross Profit vs. Net Profit: What They Mean for Your Business
Learn the difference between gross profit and net profit, how to calculate each with real examples, what good margins look like by industry, and practical strategies to improve both. Includes formulas, an income statement walkthrough, and common mistakes to avoid.
Overhead Costs: What They Are, How to Calculate and Reduce Them
Learn what overhead costs are, the three types (fixed, variable, semi-variable), how to calculate your overhead rate with formulas and examples, and eight strategies to reduce overhead and boost profitability.
SG&A Expenses: What They Are, How to Calculate Them, and Why They Matter
US SG&A (selling, general & administrative) expenses: how to calculate the ratio, benchmarks, and what to cut without hurting growth.
Break-Even Point: What It Is, How to Calculate It, and Why Every Business Owner Needs to Know
Learn what the break-even point is, how to calculate it with the break-even formula, and why every business owner needs this analysis. Includes step-by-step examples, common mistakes to avoid, and strategies to lower your break-even point.
Business Valuation: How to Determine What Your Company Is Worth
Learn how to determine what your business is worth using the four main valuation methods: asset-based, earnings multiple (SDE/EBITDA), market-based, and discounted cash flow. Includes formulas, industry multiples, and tips to increase your company's value.
Retained Earnings: What They Are, How to Calculate Them, and Why They Matter
Learn what retained earnings are, how to calculate them using the retained earnings formula, and why they matter for your small business. Includes step-by-step examples, common mistakes, and tips for managing retained profits effectively.
EBITDA: What It Is, How to Calculate It, and Why Your Business Needs It
EBITDA shows earnings before interest, taxes, depreciation, and amortization. See how to calculate it and why it matters for your small business.
Financial Management Guide for Plumbing Businesses
Effective financial management is crucial for plumbing businesses to thrive. This guide addresses unique financial challenges faced by plumbers and offers insights into managing costs for sustainable growth.
When Will Your Business Actually Turn a Profit? A Realistic Timeline for New Entrepreneurs
Understanding the timeline for profitability is crucial for new entrepreneurs. This article breaks down the factors influencing when a business starts making money and offers actionable insights to accelerate the journey to profit.
Net Income 101 — and How to Track It in Beancount
Understand the essential concept of net income and learn how to accurately track it using Beancount, a plaintext accounting system favored by engineers and financial minimalists.