The ownership stake of each shareholder is diluted as the total number of shares increases, although they receive additional shares. When a company pays a dividend, that reduces the amount of retained (post-dividend) earnings. The market may perceive a stock dividend as a shortage of cash, signaling financial problems. Market participants may believe the company […]

It’s very straightforward to calculate, providing an instant look at how much revenue a company retains after subtracting the cost of producing its goods and services. The gross margin and net margin are frequently used together to provide a comprehensive overview of a company’s financial health. Where the gross margin only accounts for the COGS, […]

Some industries, like the banking and financial services sector, have relatively high D/E ratios and that doesn’t mean the companies are in financial distress. The Debt-to-Equity (D/E) ratio is used to evaluate a company’s leverage, specifically its level of debt relative to its equity. It indicates how much debt a company is using to finance […]

To calculate taxable income, you begin by making certain adjustments from gross income to arrive at adjusted gross income (AGI). Once you have calculated adjusted gross income, you can subtract any deductions for which you qualify (either itemized or standard) to arrive at taxable income. https://www.kelleysbookkeeping.com/how-to-prepare-an-income-statement/ The marginal tax rate is the tax you pay […]

In addition to preparing taxes and providing advice, enrolled agents have permission to act on behalf of their clients in any and all dealings with the IRS. A mid-level enrolled agent with between five and 10 years of experience can generally expect to earn an average salary of $50,000. Enrolled Agent (or EA) is a […]