How Much Working Capital Should A New Business Owner Plan On Having?
Question:If you buy a business and you're getting a loan, how much capital should you have available until the business starts generating income? For example, if I have $100,000 shContinue Reading >
What Is Cash Flow?
What exactly does the term "Cash Flow" mean?GREAT question!! Cash flow is probably the most frequently misused accounting term I can think of. Cash flow is NOT profit. First undersContinue Reading >
How Important Is Earnings Percentage?
Question:In determining the value of a business, how important is it to consider the earnings percentage - i.e. earnings as a percentage of overall revenue? All things equal, if I'Continue Reading >
Sales Taxes And Net Profit
Q: When you say that taxes can be added back to get a "net profit" number would that also include sales taxes for a retail business?A: You bring up an excellent point. When you addContinue Reading >
Dealing With "Cash" Business
Question:The seller tells me there's about $25,000 a year in cash business. How can I verify this? The seller is insisting it exists and he is factoring it into the price. I'd likeContinue Reading >