Weighted Average Metrics for Income Statement and Balance Sheet formoney losing companies to determi

Discussion in 'Accounting' started by 2.7182818284590..., Apr 6, 2010.

  1. REVENUE________ 1.00000000
    COGS_EXPENSE___ 0.73653587
    GROSS_PROFIT___ 0.26346413
    EBITDA_EXPENSE_ 0.96698689
    EBITDA_________ 0.03301311
    EBIT_EXPENSE___ 1.08160911
    EBIT___________ -0.08160911
    TOTAL_COSTS____ 1.10018924
    NET_PROFIT_____ -0.10018924


    Since these companies don't pay taxes, their total interest payments
    are only 1.84% of revenues. Therefore, a financially distressed
    company is mostly caused, not by high interest payments, but by very
    high fixed costs, such as COGS and S&M/Marketing/R&D.
     
    2.7182818284590..., Apr 6, 2010
    #1
    1. Advertisements

  2. 2.7182818284590...

    Rod Speed Guest

    Re: Weighted Average Metrics for Income Statement and Balance Sheet for money losing companies to determine interest payments by tangent1.57

    2.7182818284590... wrote:

    > REVENUE________ 1.00000000
    > COGS_EXPENSE___ 0.73653587
    > GROSS_PROFIT___ 0.26346413
    > EBITDA_EXPENSE_ 0.96698689
    > EBITDA_________ 0.03301311
    > EBIT_EXPENSE___ 1.08160911
    > EBIT___________ -0.08160911
    > TOTAL_COSTS____ 1.10018924
    > NET_PROFIT_____ -0.10018924


    > Since these companies don't pay taxes,


    They do actually, just not income taxes.

    > their total interest payments are only 1.84% of revenues.
    > Therefore, a financially distressed company is mostly
    > caused, not by high interest payments, but by very high
    > fixed costs, such as COGS and S&M/Marketing/R&D.


    That utterly mangles the real story.

    They mostly go broke because not enough are buying what they are selling.

    You only get very high fixed costs when they arent selling much.
     
    Rod Speed, Apr 6, 2010
    #2
    1. Advertisements

  3. Re: Weighted Average Metrics for Income Statement and Balance Sheetfor money losing companies to determine interest payments by tangent1.57

    On Apr 6, 3:52 pm, "Rod Speed" <> wrote:
    > 2.7182818284590... wrote:
    > > REVENUE________ 1.00000000
    > > COGS_EXPENSE___ 0.73653587
    > > GROSS_PROFIT___ 0.26346413
    > > EBITDA_EXPENSE_ 0.96698689
    > > EBITDA_________ 0.03301311
    > > EBIT_EXPENSE___ 1.08160911
    > > EBIT___________ -0.08160911
    > > TOTAL_COSTS____ 1.10018924
    > > NET_PROFIT_____ -0.10018924
    > > Since these companies don't pay taxes,

    >
    > They do actually, just not income taxes.
    >
    > > their total interest payments are only 1.84% of revenues.
    > > Therefore, a financially distressed company is mostly
    > > caused, not by high interest payments, but by very high
    > > fixed costs, such as COGS and S&M/Marketing/R&D.

    >
    > That utterly mangles the real story.
    >
    > They mostly go broke because not enough are buying what they are selling.
    >
    > You only get very high fixed costs when they arent selling much.


    I agree with your opinion as well. Keep in mind, if the revenues
    increased, than the debt/revenues would DECREASE. It wouild be less
    than 1.84% of revenues.
     
    2.7182818284590..., Apr 7, 2010
    #3
  4. 2.7182818284590...

    Alexandra.Dumitriu

    Joined:
    Aug 13, 2015
    Messages:
    3
    Likes Received:
    0
    can you help me?

    I have this situation:

    Clients: 167080

    Services:147812

    The gross profit: 167080-147812= 19268

    Administrative Expenses : 10143

    The net Profit is 9125

    The Corporation tax is 1825

    The debtors and the creditors are 0 because what was paid also was cashed.


    i Have some difiiculties completing the Trial balance
     
    Alexandra.Dumitriu, Aug 13, 2015
    #4
    1. Advertisements

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments (here). After that, you can post your question and our members will help you out.
Similar Threads
  1. themurf
    Replies:
    0
    Views:
    808
    themurf
    Aug 2, 2007
  2. W
    Replies:
    4
    Views:
    4,179
    guidocinelli
    Dec 22, 2009
  3. 2.7182818284590...
    Replies:
    1
    Views:
    684
    Rod Speed
    Mar 29, 2010
  4. 2.7182818284590...
    Replies:
    1
    Views:
    905
    Blash
    Apr 6, 2010
  5. 2.7182818284590...
    Replies:
    1
    Views:
    686
    Rod Speed
    Apr 6, 2010
  6. lbuntha

    Income Statement and Balance Sheet

    lbuntha, Feb 17, 2012, in forum: General Accountancy Discussion
    Replies:
    2
    Views:
    6,738
    lbuntha
    Feb 23, 2012
  7. pry001

    UK Help preparing balance sheet & income statement

    pry001, Mar 18, 2012, in forum: General Accountancy Discussion
    Replies:
    7
    Views:
    2,519
    pry001
    Mar 18, 2012
  8. maitha
    Replies:
    2
    Views:
    635
Loading...