Owning shares in another company can be reported three very different ways. How the level of influence decides between fair value, the equity method and consolidation, in Australia and the US.
A side-by-side guide to how the same purchase is recorded as an asset acquisition or a business combination: cost allocation, transaction costs, goodwill and the effect on future profits.
Lessons for businesses selling commodities or near-commodities: respecting volatility, understanding risks, limiting losses, earning returns through turnover and building a brand customers choose.
Whether an acquisition counts as buying a business changes the accounting completely. What inputs, processes and outputs mean, how the concentration test works, and worked examples.
A practical guide for business owners planning an acquisition: how deal terms flow into the accounts, from due diligence and purchase price allocation to earn-outs, goodwill and post-deal reporting.
Why capital follows businesses that have proven customers and unit economics, how to start with little capital through partnerships and customer funding, and ten questions for choosing debt or equity.
How a parent and its subsidiaries are combined into one set of accounts: adding line by line, eliminating the investment and intra-group dealings, recognising goodwill and non-controlling interests.
A practical guide to cost control for product and manufacturing businesses: understand cost of goods sold, materials, labour, variable costs, equipment utilisation and cash.
How to compare all the costs and benefits of a decision, including hidden, opportunity and intangible ones, then test it with payback, NPV and sensitivity, using a worked machine purchase.
How to calculate customer lifetime value and customer acquisition cost, measure retention and churn, compare repeat and referral businesses, and grow customer value through the loyalty ladder.
How to choose between loans and investors using ten questions on cash flow, margins, security, ownership and capacity, plus customer funding and frugal ways to expand.
Discount strategy for small businesses: good reasons to discount, fifteen discount types, the extra volume a discount needs to break even, and how to avoid training customers to wait.
·10 min read
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