Tag: accounting

Accounting for Entrepreneurs #2 : Calculating Asset Utilization

Accounting for Entrepreneurs #2 : Calculating Asset Utilization

What it Measures How efficiently an organisation uses its resources and in turn, the effectiveness of the organization’s managers. Why is it Important The success of any enterprise is tied to its ability to manage and leverage its assets. Hefty sales and profits can hide any number of inefficiencies. By examining several relationships between sales…

Read More Read More

Accounting for Entrepreneurs #1 : Calculating Asset Turnover

Accounting for Entrepreneurs #1 : Calculating Asset Turnover

What it Measures The amount of sales generated for every unit currency worth of assets over a given period. Why is it Important Asset turnover measures how well a company is leveraging its assets to produce revenue. A well-managed manufacturer, for example, will make its plant and equipment work hard for the business by minimising…

Read More Read More