A statement of retained earnings details how much of a company’s earnings were kept within a given time period, and is used to track fluctuations in retained earnings. It shows the current equity of a company and is important for tax purposes. A statement of retained earnings is an accounting term used to describe a […]
Earnings and profits are not the same; earnings are income minus costs, while profit is the cash a business keeps after expenses. Confusing the two can harm a business financially. Calculations are used to determine financial health and report income to tax authorities. Gains and profits are related, but not exactly the same. Earnings and […]
Retained earnings tax is an additional tax paid by corporations that choose to retain earnings instead of paying dividends, calculated in addition to regular corporate income tax. The tax encourages dividends and minimizes tax loss for the government. Retained earnings tax is an additional business tax paid by corporations that choose to retain retained earnings […]
Governments impose a retained earnings tax on corporations that accumulate savings above a certain threshold, to make up for income lost through the non-distribution of dividends. This tax is aimed at combating the practice of hoarding cash to avoid double taxation. A retained earnings tax is an income tax assessment on corporate savings that exceed […]
Covered earnings are the portion of an employee’s income used to calculate retirement benefits, including taxable income and income from sources other than wages. This figure is important for determining contributions to government-sponsored pension plans and varies by country. Some income may be exempt from consideration. “Covered earnings” is a term that identifies the portion […]
Earnings before taxes (EBT) is a company’s revenue minus expenses before taxes are taken out. A healthy EBT can help a company weather economic downturns, service debt obligations, and receive better interest rates from lenders. Investors use EBT to evaluate a company’s financial stability and predict investment returns. Earnings before taxes, or EBT, is the […]
Earnings garnishment is a legal process where a creditor takes a percentage of a defendant’s salary to settle a debt. The process varies by state and some types of income are exempt. Filing for bankruptcy or designating the court clerk as a trustee can prevent garnishment. Another way to pay off debts is through “wiretapping,” […]
Insurable earnings include any earnings generated by insurable employment, such as wages, salaries, commissions, bonuses, and benefits. These earnings are generally taxable and impact unemployment coverage and compensation. Employers are required to report each type of earnings separately on employee earnings statements or pay stubs. Insurable earnings are any type of earnings generated by insurable […]
Target earnings refer to the total compensation expectations for sales professionals, including base salary and commission payments based on sales quotas. The commission portion is often a significant part of the total earnings, and employers set quotas for salespeople to achieve. Target earnings is a term used in the business world to describe compensation expectations […]
Retained earnings are profits that a company doesn’t pay out as dividends to investors, but instead reinvests in the company to pay off debt or invest in future growth, leading to higher earnings and a healthier corporation. Sometimes referred to as earned surplus, retained earnings are income or profits that are received by a company, […]
Earnings and profits are different in how they are calculated. Earnings are what a business makes after subtracting costs, while profit is the cash a business holds after expenses. Confusing the two can lead to financial failure. Tax agencies use earnings to determine a company’s financial status. Earnings and profits are related, but they’re not […]
An earnings credit rate is an interest rate used to determine bank service charges for business accounts. It identifies fees charged for banking services used and offsets them with balances maintained in the account. It encourages customers to maintain larger balances and can be used as a marketing tool. Clients should review monthly account statements […]
Post-earnings drift is a phenomenon where stocks move in the direction of earnings surprises for months on average. Investors can use this strategy to buy stocks that recently posted better-than-expected earnings, but it can also lead to volatility in investment portfolios. The effectiveness of this strategy is inconclusive due to many variables. Publicly traded companies […]
To make money with affiliate programs, choose a product you’re passionate about, follow program rules, and avoid scams. Passion for the product is crucial for motivation. Many businesses have affiliate programs, and fake leads can result in a permanent ban. Beware of promises of quick profits and programs that require payment to join. Making money […]
Earnings yield, also known as the price-earnings ratio, is a ratio used by investors to assess the value of a stock. It is calculated by dividing a corporation’s earnings per share by the current share price and expressed as a percentage. Investment managers consider high returns as undervalued and low returns as overvalued, but other […]
Retained earnings are profits kept by a company for internal use or future investments, and can be divided into appropriate and inappropriate categories. The accounting equation helps determine retained earnings, and investors can find information on a company’s retained earnings in quarterly or annual reports. The appropriate amount of retained earnings and their specific use […]
Earnings season is when publicly traded companies disclose financial information to the public, usually following quarterly meetings with investors. It typically lasts up to six weeks and can impact share prices. Companies now make this information available on their websites and through web conferences. Earnings season is the term used to identify various times of […]
Accumulated earnings are income not paid out as dividends, used to pay off debt or invest in the company’s future, demonstrating financial stability and potential for higher profits. Sometimes referred to as earned surplus, accumulated earnings are income or earnings that are received by a company, but are not paid out as dividends to the […]
