ADP RUN articles

It is also an important indicator of a company’s financial and operational performance. A high accounts receivable turnover indicates an efficient business operation or tight credit policies or a cash basis for the regular operation. Whereas, a low or declining accounts receivable turnover indicates a collection problem from its customer. When you hold onto receivables for a long period of time, a company faces an opportunity cost.
Secondly, the ratio enables companies to determine if th […]

In accounting, limited-life intangible assets are amortized over the exact period they’re deemed useful. Amortization means dividing the cost of the asset according to how much it was used in each accounting period. An intangible asset is a resource that has no physical presence and has long-term value for a business.
While intangible assets can’t be seen or touched, they can still hold value and are important when it comes to ensuring the success and growth of a business. These ty […]

A direct cost is a cost that is directly traceable to the production of goods and services…. More detailed definitions can be found in accounting textbooks or from an accounting professional. Understanding your costs will help you effectively price your products for optimal sales.
In construction, the costs of materials, labor, equipment, etc., and all directly involved efforts or expenses for the cost object are direct costs. Because these activities are easily traced to projects, their […]

This type of hypothesis is constructed to state the independent variable followed by the predicted impact on the dependent variable. The dependent variable, in both cases, is what is being observed or studied to see how it changes in response to the independent variable. In this particular example, the type of information is the independent variable (because it changes), and the amount of information remembered is the dependent variable (because this is being measured). The dependent variable […]

In real estate, an indenture is a deed in which two parties agree to continuing obligations. For example, one party may agree to maintain a property and the other may agree to make payments on it. The agreement mentions that XYZ Inc. would maintain a debt-equity ratio of 2.0x throughout the tenure of the loan, and any breach would trigger the event. Therefore, the borrower (XYZ Inc.) and the lender (ABC Bank) agreed upon this condition of maintaining the debt-equity ratio above 2.0x. XYZ Inc. […]

These examples are programmatically compiled from various online sources to illustrate current usage of the word ‘impairment.’ Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. ABC Company, based in Florida, purchased a building many years ago at a historical cost of $250,000. It has taken a total of $100,000 in depreciation on the building and therefore has $100,000 in accumulated depreciation. The building’s carrying value, or […]