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Lessor vs Lessee: The Fundamentals of Lease Agreements

March 30th, 2015

The relationship between lessor vs lessee is a common one, but many people might not understand all of the details of the situation. At its core, a lessor is someone who owns a property, object, trademark, business, or any other piece of real or intellectual property. The lessee pays the lessor for the right to
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The Differences Between Revenue vs Profit

March 30th, 2015

One of the trickiest distinctions to make when it comes to managing your business is the difference between revenue vs profit. There are a few simple rules for determining which is which. One of the hard and fast rules is that profit will never exceed revenue, and it is typically less. To put it plainly,
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Validity vs Reliability — What’s the Difference?

March 16th, 2015

The definitions and usage of validity and reliability differ subtly across different disciplines, with exact definitions differing depending on context. In statistics, as well as sciences that use statistics to empirically reach conclusions, both the validity and reliability of information being presented need to be exist in order for conclusions to be made, or in
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Standard Deviation vs Standard Error — What’s the Difference?

March 16th, 2015

Statistics is and always has been a difficult mathematical mine field to wade through, a jumble of numbers, extrapolations and postulations that is increasingly used to help wade through the ever increasing amounts of data and information available to decision makers. With statistics used to predict everything from stock market trends to baseball games, a
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Arbitration vs. Mediation — What’s the Difference?

February 18th, 2015

The world of law, lawyers, legalese and courtrooms is one that is rightly feared by every day law fearing Americans. Because of the complexities and costs involved with any lawsuit, cooler heads have found legal alternatives to the long and arduous process of the legal system that offer binding and amicable solutions to legal disputes.
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Accountability vs. Responsibility — What’s the Difference?

February 10th, 2015

In the real world, it is expected that people in day to day interactions – whether the people who receive financial investments, the people who work for a firm, or the people who provide services to others – to suffer or benefit from the consequences of their actions to varying degrees. However, depending on the
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Should You Check Your Accountant’s Work?

January 16th, 2015

My wife and I own some income property between us and have operated a real estate management firm for a couple of years. We have used the same accountant in that time and we want to be sure he’s doing a good job. My question is, how do we do a finance check or an
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Tips to Find a Good Investor

January 16th, 2015

I came up with a great idea for a website business and need some money to get it off the ground. Could you please tell me how do you find investors? The easiest and most accessible funding option for most people is an affluent relative or friend who could extend a loan for you to
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Financial Accounting vs. Management Accounting

January 5th, 2015

Within accounting there are two key fields that relate to different aspects of the businesses finances, financial accounting and management accounting. While both use the same underlying information, for the most part, the use and perspective provided can vary greatly. This article will explain the differences between financial accounting and management accounting. Financial Accounting Financial
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Accounts Payable vs. Accounts Receivable

January 5th, 2015

Two concepts important to any business owner or business analyst are accounts receivable and accounts payable. These like sounding accounts on the financial statements have very difference meanings and understanding both is essential to any business owner. Accounts Payable Accounts payable are obligations of a business to re-pay a certain amount to another party. If
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Compound Interest vs. Simple Interest

January 5th, 2015

Everyone is familiar with the concept of interest, whether they are earning it on their investments or paying it on their debts. Compound interest and simple interest are two different types of interest and understanding the difference between the two can be very important. Simple Interest Simple interest refers to applying the interest rate on
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Fixed Cost vs. Variable Cost

December 31st, 2014

As a business owner there are two key groupings for costs that it is important to understand, fixed costs and variable costs. By understanding these two concepts and the types of costs that fall into these groups can greatly assist with managing your business. Fixed Costs Fixed costs are the types of costs incurred in
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Income vs. Revenue

December 31st, 2014

When evaluating a company from an investment perspective two of the key figures to look at are the revenue and income amounts generated by that company. This article will help you differentiate between the two and also understand how they each need to be assessed. Revenue Revenues refer to the total amount of money that
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Balance Sheet vs. Income Statement

December 31st, 2014

Two of the most significant documents when it comes to assessing a company financially are the balance sheet and the income statement. While they both show important financial information there are key differences that are important to understand when it comes to reviewing a balance sheet vs. an income statement. Balance Sheet A balance sheet
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Debt vs. Equity

December 31st, 2014

When companies are looking to fund growth and expand there are two main sources those funds can come from, debt and equity. Utilizing both effectively is important for any business owner and understanding the differences between them can be important when choosing between debt vs. equity. Striking the right balance between debt and equity financing
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FSA vs. HSA

December 3rd, 2014

Flexible Savings Accounts (FSA) and Health Savings Accounts (HAS) are both tax-advantaged accounts (as deemed by the IRS) that can be used to pay healthcare expenses. There are significant differences, however, and it is important to understand those differences in terms of where you withdraw funds or when you have the option from your employer
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FIFO vs. LIFO

December 3rd, 2014

While inventory may seem like a straight forward balance sheet account there are different ways of valuing inventory that can have a significant impact on a company’s income. First in first out (FIFO) and last in first out (LIFO) are two of the more prominent ways of valuing inventory and a company using one versus
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Amortization vs. Depreciation

December 3rd, 2014

In accounting, the terms amortization and depreciation are both used a great deal and it can be difficult for non-accountants to follow exactly what they’re referring to. While technically there are differences, which will be discussed below, in practice amortization and depreciation are used interchangeably. The technical difference is more of an academic one, with
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GAAP vs. IFRS

December 1st, 2014

International Financial Reporting Standards (IFRS) and U.S. Generally Accepted Accounting Principles (GAAP) are the both formalized accounting and financial guidelines that businesses may have to follow. In the U.S., all publicly traded companies are required to report using GAAP, and in many international markets IFRS is required for publicly traded companies. Companies listed on two
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Capex vs. Opex

November 25th, 2014

When discussing expenses in a company you will often hear reference to capex and opex, while both refer to money being paid out of a company they have very different meanings. Understanding the different meanings is important to having a clear picture of what is being referred to and this article will help you follow
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