Cash in hand is a measure of cash an organization, business or company has available after all the costs or expenses have been paid. It…
What is a Cash Conversion Cycle? Definition, Formula and Usage
The Cash Conversion Cycle is a method used for measuring the approximate number of days a company might take to convert its stock or inventor…
What is a Cash Budget? Definition, Importance, Functions and Example
A cash budget is a budgeting method of representing the expected future income or cash flow of an organization throughout a given timeframe. It refers…
What is Debt? Definition, Types, Pros and Cons
A debt is an amount of money that is owed by one person to another. Debt can be useful in many situations, but it can…
What is Debt Capital? Definition, Types and Examples
Debt capital is money that a business raises by selling debt instruments to investors. Debt capital can come from bonds, loans, or other sources. The…
What is Debt Capacity? Definition, Calculations and Factors that affect it
Debt capacity is the amount of debt that a company can take on without adversely affecting its financial stability. In other words, it is the…
Deferred Revenue – Definition, Importance and Examples
Deferred revenue is the amount of money that a company has received from its customers for products or services that have not been delivered yet….
Days Sales in Inventory (DSI) – Definition, Formula and Benefits
Days sales in inventory is a metric that measures how long it takes a company’s inventory to convert into sold products. It is also known…
Days Sales Outstanding – Definition, Formula, Importance and Examples
What are Days Sales Outstanding? The days sales outstanding (DSO) is a figure that indicates how successful a company is in collecting money from customers….
Debenture – Definition, Types, Features, Pros and Cons
What is a Debenture? A debenture is a debt instrument that is not backed by any collateral and is usually issued for a period of…
Debt Capital Markets – Definition, Types, Pros and Cons
The debt capital markets (DCM) are a key source of funding for companies and governments. They provide a way for issuers to raise debt financing…
Debit Balance – Definition, Meaning and how it works
A debit balance is a condition that occurs when the sum of all debit entries in a general ledger is greater than the total amount…
Days Payable Outstanding (DPO) – Definition, Calculation and Examples
Days payable outstanding (DPO) is a measure of how quickly a company pays its bills and invoices from its creditors. It refers to the average…
Days of Inventory on Hand (doh) – Definition, Calculation, Examples
Days of inventory on hand (doh) is a metric used to measure the number of days that a company takes to sell its inventory. In…
Defensive Industries – Definition, Characteristics, Examples and Advantages
What are Defensive Industries? Defensive industries are companies whose revenues and earnings are relatively insensitive to economic cycles. These businesses provide essential goods and services…
Deleveraging – Definition, Techniques, Meaning and Advantages
What is Deleveraging? Deleveraging is the practice of reducing the leverage ratio or the percentage of debt in a single economic entity’s balance sheet. It’s…
Digital Wallet – Definition, Working, Types and Advantages
What Is a Digital Wallet? A digital wallet is a mobile application, software, or online service that allows people or companies to make transactions, store…
Disclaimer of Opinion – Definition, Meaning and Types
What is a Disclaimer of Opinion? A disclaimer of opinion is an auditor’s statement that expresses neither an affirmative nor a negative opinion on an…
Downtrend – Definition, Identification and Examples
What is a downtrend? A downtrend is defined as a series of lower lows and lower highs in the price or value of a stock…
Dupont Analysis – Definition, Formula and Calculation
What Is Dupont Analysis? Dupont analysis is a performance assessment framework that measures a company’s financial performance by breaking down its return on equity (ROE)…
Economic Cost – Definition, Examples and Calculation
What is Economic Cost? The economic cost is the opportunity cost associated with a particular decision or action and it is an evaluation of the…
Carrying Amount – Definition, Formula and How to Calculate?
The carrying amount is the first cost of an asset given in the balance sheet or company’s books of a company minus the accumulated depreciation…
Carriage Outwards – Definition, Meaning and Examples
Carriage outwards is the shipping and handling costs incurred by a supplier that is transporting goods to a purchaser. The supplier might have the option…
Deferred Tax Asset – Definition, Calculation and Examples
A deferred tax asset is an accounting term that refers to a situation where a company has paid more taxes than what is currently required….
Deferred Tax Liability – Definition, Importance, Calculation and Examples
Deferred tax liability is a tax obligation that has been deferred to a future period. This means that the tax liability has not yet been…
Degree of Total Leverage – Definition, Calculation, and Importance
The degree of total leverage is a ratio that compares the rate of change in earnings per share (EPS) to the rate of change in…
Degree of Operating Leverage – Definition, Calculation and Importance
The degree of operating leverage (DOL) is a measurement that indicates the change in a company’s operating income in response to a change in sales….
Discounted Cash Flow – Definition, Formula, Pros and Cons
Discounted cash flow is a financial method used to estimate the future value of an investment. The discounted cash flow (DCF) method discounts all future…
Divestment – Definition, Types and Examples
Divestment is the opposite of investment. It is the act of selling off assets, usually in order to reduce risk. For example, a company might…
Closing Stock – Definition, Calculation, Formula and Examples
Closing stock is the quantity of inventory that a firm has at the end of a financial period. Inventory can be raw materials, work-in-process, or…
Deferred Income Tax (DIT) – Definition, Types and Examples
Deferred income tax (DIT) is an accounting concept that refers to the difference between the reported income of a company and its taxable income. It…
Deferred Annuity – Definition, Types, Pros and Cons
A deferred annuity is an insurance product that allows you to save for retirement or other long-term goals. With a deferred annuity, you can make…
Default Risk – Definition, Types and Factors
Default risk is the possibility that a borrower will be unable to meet its financial obligations. This can happen for a variety of reasons, including…
Degree of Combined Leverage – Definition, Formula, Calculation and Examples
The degree of combined leverage is the degree to which a company’s operations are financed by borrowed funds. It is calculated by dividing the sum…
Deferred Interest – Definition, Risks, Pros and Cons
Deferred interest is a type of financing that allows consumers to make large purchases now and pay for them over time, without accruing interest charges…
Delivery Versus Payment (DVP) – Definition and How it Works
Delivery versus payment DVP is a type of securities settlement in which the delivery of securities and the payment of funds take place simultaneously or…
Direct Tax – Definition, Types, Advantages and Disadvantages
Direct tax is the tax levied on individuals or businesses for which they are directly responsible. The most common direct taxes are income taxes, property…
Direct Labor – Definition, Formula, Calculation and Examples
Direct labor is the term used to describe the work done by employees who are directly involved in creating a product or service. This includes…
Direct Expense: Definition, Examples, Importance
Direct expense refers to an immediate and direct financial cost incurred by a business. This could include raw materials, labor, shipping, and other costs associated…
Demerger: Definition, Types, Pros and Cons
A demerger is a type of corporate restructuring in which a company splits into two or more separate entities. This separates the company’s operations, assets,…
