In business, there are two kinds of costs: direct costs and indirect costs. What are Direct Costs? A direct cost is the cost of producing goods or services, including raw materials and labor. Direct costs are only reported once the … Read More »

Cash is like air; profit is like food. You need cash all the time, but you can survive, for a while, without profit. All employees must understand the difference between cash and profit to make the best decisions for your … Read More »

Watch Out for the Ludic Fallacy: Don’t Let it Spoil Your Business Simulation Game Experience Written by Nikolai from Income|Outcome Humans have been modeling life with games since at least the First Egyptian Dynasty and have been using what they … Read More »

Gross margin is a finance term that seems to be defined differently by every company. Gross Margin Defined Gross margin is gross profit expressed as a percentage of sales. Gross profit is the money earned from a sale minus the … Read More »

There are three main pillars of financial reporting. We’ve already discussed income statements and balance sheets. But what is a statement of cash flow? The broad purpose of a statement of cash flow is to show where cash in your business … Read More »

Income statement is a common term, but are you aware of everything it comprises? An income statement is a history book of the sales, costs, and expenses over a given period of time. Publicly traded companies are required to publish … Read More »

What is a balance sheet? The Balance Sheet is a statement of what you have (in the business) and where the funding came from.  It adds together all the assets in the business (“what you have”), and adds together all … Read More »

The statistics on the earnings of entrepreneurs in the U.S. might give pause to anyone thinking of starting a business. An article by Bloomberg Business revealed that U.S. entrepreneurs make 35% less than employees. Recently, we discussed the statistic with … Read More »