To properly understand a company’s income statement there are a variety of factors that plays a major role. If calculated properly you will be able to identify the gross profit of the company along with its net income. To start the income statement you will need to identify the amount of revenue (sales) that the company has made thus far in a given time period. Sales/revenue is considered to be the amount of cash/credit (basically money) that a company generates in a given period including discounts with consideration of returned merchandise. After identifying the revenue the next step is to calculate the cost of goods sold (COGS).
This can be found through multiple ways, it depends on how you want to make the numbers look for an investor. The first of which is the First in first out method (FIFO), this method gives a lower result for net income and less in taxes. The first in first out measures the ending inventory. The next method is the Last in First out (LIFO), which measure the beginning inventory. This calculation produces a more favorable result for net income, but results in higher taxes being paid. The last method is to do a summation, pretty much an average of all your remaining inventories and cost of those inventory and find an average price. By using the average method net income will mid-way between your FIFO and LIFO results, same goes with the tax associated. When you have calculated COGS then you will be able to get the company’s gross profit by using the following formula [revenue-COGS] =gross profit.
It is very important to understand that gross profit is not your final income. What I mean by that is that gross profit is the amount of money you have on hand before you pay your bills. Bills/operating expense are generated from things such as storage space rental, insurance, equipment purchases, etc. Operating expenses are sometimes easy to identify by finding the accounts payable journal entries. After you have added up all your expenses from accounts payable then you are now capable of generating the Income before tax figures. The income before tax is calculated by using the following method [gross profit-operation expense].
Subsequent to recognizing what your income before tax is then you can proceed with calculating the amount of tax to be withheld. Depending on the state you are in and sometimes the type of business you are in the tax percentage will be different. Therefore, it is best to have a license accountant consult your business to ensure that you are paying the right amount in taxes and also to see where you can save a few dollars in operation cost. OK, so once you have the tax percentage calculated for your business type and state then you minus the percentage amount in dollars, (for example 10% of $10.00 is $1.00, 10-1=9),then you subtract the tax amount from your income before tax [income before tax-tax expense]. This will produce the net income for the business. There you have it, understanding the income statement line by line. Until next time think ethically.
For some strange reason the only thing that has been on my mind is finance 300, yes Prof. Browns class. Primarily because I just had an exam that was out of this world (or at least my world). I realized that I must eat, sleep, breathe and talk finance 300 in order to be successful in this class. So I figured it would be beneficial if I wrote about this class and some of its more general topics. Over the last couple of weeks we have discussed topics such as Treasury notes/Bond, futures market, stock options, and credit.
When trying to build your credit it is essential to ensure that you do not have any outstanding debts that you are unaware of. These types of debts are called Zombie debts. A Zombie debt is pretty much what the name says; it is a debt that was presumably written off but has come back after several years. This can sometimes cause endurance when trying to get loans for a new home or car. When this happens sometimes it can lead to a Universal default on your credit cards, if this happens then all the other credit companies that you are associated with will use that information to determine if they should raise your rate. So the bottom line is if you default on one card the other credit card companies can raise your rate.
Next we come to Securities; a security is a piece of paper that can be assigned a value (i.e. $10-$1000). A security is pretty much a stock or bond certificate. The stock market is a lot more complicated than people really think. There are several categories of the stock market, the first of which is the bear markets which includes but not limited to NYSE (the New York Stock Exchange). It is called a bear market because it is not as risky as the other markets and companies generally have been around for several years and also demonstrates a good track record for investment opportunities.
The second of type of market is the bull market which includes but not limited to the NASDAQ (National Association of Securities Dealers Automated Quotations). This market represents more risky securities but not the riskiest. Stock brokers in this market generally do short selling. Stock prices in this market tend to be higher with a great chance of increasing. This market is not recommended for mom and pop type investments, for retirement funds it is best to invest money into companies that demonstrate a great dividend payout. You are guaranteed the interest on your investment but you are not guaranteed to be paid the dividend. The securities markets are wide open and if you are young and have the time then try investing. It will pay off in the long run. Until next time think ethically.
This one is for you Ms. Geddes; I felt it necessary to start the article off with a simple reminder of why life is good.
Looking at this picture it’s hard to believe that they have grown up so fast already. I remember walking out of the hospital with my nephew when he was born now he is seven years old and almost taller than I am. In addition, my nieces are growing up into wonderful young woman and to be honest I’m a bit scared. I am scared mostly because of then talking to boys when they get older, so to offset the moment I have been bribing them with whatever they want so that no other guy can impress them when they get older. (lol I know I know, it’s wrong yes but when you have precious gifts in your life like these three you will do anything to protect them). The bottom line is that this picture makes me feel old.
This woman is the love of my life. My mother and papa are the best parents in the world. Call me bias but that’s the truth. Thanks mom for being there for me whether I was good or bad. You just can’t find mothers like this one “now a days”. I think God stop making this model.
This week has been one of great challenge for me, I am glad the week is over. Looking at these pictures helps me to relax and focus on what’s important in life. I implore you, if you have the time search and find what your inspiration(s) is/are. Finding this will allow you to navigate the hard times that come up in your life. A wise person once told me “don’t wait on motivation it’s not going to come”. At fist i was a bit offended but then I realized he was right. Motivation is something you the individual create not something that just hit you one day. So find what motivates you and what makes you feel at ease.
“Heights of great men reached and kept were not obtained by sudden flight but, while their companions slept, they were toiling upward in the night” (Henry Wadworth Longfellow)
Thinking ethically is something that I had the privilege of learning how to do this week. It is not always about the profit gain when deciding to pursue a business idea ( lol I know it backwards of what we are being told to focus on in our marketing, economics and accounting classes), a “wise man” once told me to pick my career based on three facts. The first of which being; what can you do for long hours and not get bored or paid? The second was what work could I do and not rely on positive feedback from my superiors and still give 100%? And the last one was what will make you a better man by the time you’re done working each day? These three questions have lingered with me for the past couple of years as I try to traverse this campus and find my place in it, until I eventually decided to become a marketing manager major.
It is not easy coming from a CPS school and being able to compete with some of the best and brightest this state has to offer. However, through perseverance and the help of the CHANCE program I am able to still pursue my educational goals. The reason I mentioned CPS was not to downgrade the hard work put in by the faculty and staff at these high schools but it was done in an effort to shed light on something that most people know but not many individuals seem to address. My intentions here at UIC is not solely for the monetary rewards I will receive with a higher education but it is the hope of one day giving back to this great community of Chicago. Through this wonderful University I have been able to develop life skills that I am quite certain will take me far with my career, ensuring success and philanthropy.
CPS high school students across the city have a 30% chance of graduating which mean there is a 70% chance that they will not graduate (keep in mind that the percentage presented has a standard deviation of ± 5). There has been several research projects dedicated to finding out the true causes of this epidemic and in addition aimed at generate positive solutions. The research has shown that there are four main reasons as to why students drop out of high school, and those four reasons are teenage pregnancy, lack of financial assistance from their families, lack of motivation and lack of resources. Although there is more to the main four reasons, each student is different when it comes to deciding if they should drop out. Now that the issues have been identified it is then best to provide solutions. Some of those solutions are providing more professional relationships between school faculty and students, with things such as(mentoring programs, counseling, tutoring etc),also financial support from those involved in the students life or allocations from the state to help fund a child’s education. Many students feel as though the lack of motivation within a school environment helps to foster the thought of dropping out because they do not feel challenge. Moreover, students’ in public schools lack the resources they need to pursue their career interest.
And of those who make it to the post secondary level they then face the challenge of competing on a playing field that they are not well equipped for. What does this have to do with UIC one might ask; well it has a lot to do with us. The main reason being that we are one of the largest college in Chicago and not only that but we produce some of the best and brightest this city has ever seen. I implore my fellow students to think about what you can offer back to your community with the knowledge you obtain here at UIC, not just for profit. Helping a fellow classmate who is struggling seems to be insignificant but in essence you have just helped the schools retention rates go up. “Each one teach one”, no man is an island no man stands alone. Until next time think ethically.
Home is where the heart is and well my heart was definitely left in Jamaica. My country is one of the most unique places I have ever had the chance to live in. It is a paradise; whenever I am there my mind is at peace. No worries about bills or danger or even severe weather. Jamaica is my safe haven and I intend to bring back the knowledge I obtain through UIC to better serve my people back. The country is filled with vast resources that in the hands of the right people can be allocated to help the country grow. I tend to laugh when people demean my country due cultural ignorance, little do they know that even though the country is poor the people are happy. Jamaicans are by far some of the happiest people on earth I have ever known. I guess the strangest question I have ever received was “oh do you guys wear cloths in Jamaica?” On one hand I was aghast to know that someone actually had the capacity or no capacity for that matter to conceptualize the fact that Jamaicans might not have worn cloths. And on the other hand I credit this misconception to the vast media misinformation.
Now am I saying Jamaica is the safest place in the word? No, not so much but the way of life and what it means to share and love one another is greater than what you would find in most industrialized nations. Let’s just be clear about one thing, I love America, its freedom, its people, its unique cultures and ideas, and just as much as there is bad publicity about America around the world so it is with Jamaica. The island itself is beautiful, however it is the hearts and minds of those who choose to inhabit it that makes it what it really is. I often dream of business strategies that would allow Jamaica to have cross cultural exchanges with other nations so as to ensure the proper avenue for communications with the country. I know it’s a broad and big dream, but like I always say you can change the world just by changing the life of one individual for the betterment of mankind. By my major having a focus on marketing more specifically with a sub focus on international business, I often think of ways I can incorporate the things I am now learning in my IDS, Management , Accounting and Finance classes to develop a import business, one that would benefit non-profits here in the United States and those in Jamaica.
My business will allow all of my customers to taste, feel, see or smell (lol, the good ones) a part of Jamaica without ever setting foot in the country. Iol, despite the fact that this idea is still in its conception phase I have high hopes for the outcomes for it. I am almost certain that with the resources and knowledge that’s being provided here at UIC I will be able to get the ball rolling by the time I graduate. And just a side note, I would like to say thank you to all UIC staff members from the janitors to the president, no matter what your role is it is an integral part of what makes this university function and because of your hard work “hopefully” I will be able to see my ideas come forth. To all who can go to Jamaica don’t hesitate, head on over and have some fun soak up some sun!
The sweet life
sunset by my home
My niece, she is the reason why ever day is a good day for me
Remembering what motivated you to attend college can be an invaluable asset to those who choose to use it. What is the true value of a college education? What motivates you to keep going forward? Most individuals tend to associate these questions with the cliché answer, “oh well it’s for financial stability”. I find this response inapplicable in some students’ lives, the main intent and purpose for that student attending college is not always for the monetary gains. Yes, a college degree does provide students with the resources to secure their own wealth. However, what are other driving factors that lead students to attending college and stay in there? I personally believe that most students are here simply because they were told at some point in their education career that this was a good thing for them, don’t get me wrong it really is a good thing. But this proves to me that most of the students, not all, made their decisions about attending college based on what someone else informed them to do, with the student not always having their own reasons as to why they decided to attend college.
For instance, I decided to attend college not primarily for the monetary gains but because of the void in proper role models for my nieces and nephew. Now most of you would say “well of course you are going to college so you can make money to help your family”, and to those people I say you are right but wrong. Do not get misunderstand me, attending college and not just any college, UIC for that matter, was one of the best decisions I have ever made. I attend college so that they can have an example to follow and hopefully reach further than I will. The bottom line to what I am saying is what is your motivation? What is intrinsically pushing you to achieve more in life? Quite honestly the pursuit of money can only get you so far. It is through the values and morals learned here at college that will allow you to become not just another individual with a degree but one that can change the world one person at a time. Now that might be a bit too much of a “head in the clouds” concept on college for some, but then again it is my personal opinion. If I were to say to my nephew (when he reaches the appropriate age that is) make sure you attend college/university.
At that point I should be more than able to say to him, look these are the steps I took to attain the things I have attained and this is what you can possibly do too. Leading by example is a far more efficient way of doing things rather than issuing rules, regulations and instructions. Therefore, when I am presented to him as a road map through life and college, he can see my flaws and my pros and decide if he wants to emulate then. I am not condemning those whose sole purpose is monetary gain, because maybe you have some extraneous situations that require just that and then again it is your own personal view. But even if your pursuit if sole monetary gain, there is something giving you that drive to wake up every morning and make a conscious decision to attend classes, do assignments on time and be a model student. “A man/woman who stands for nothing will fall for anything”, with that being stated—stand on what motivated you to be here and accomplished more than you had initially set out to accomplish.
So once again my day was off to a busy start, waking up at 5:30 am just to ensure my timely departure from my humble abode (just a side note, I love my man cave). In order to make my 8 o’clock class on time I must be on my way by 6:45 am. This then means I have an hour to get ready and wait for the CTA, well to be honest most times its 25 minutes because I like to over sleep. I don’t know what it is with over sleeping but it gives me some type of feeling as though I had a long productive day the day before, and that’s not always true. Do you every have those days when it’s long but not productive? Yeah I’m talking about those days when you decide to watch all the installments of the Lord of the Ring trilogy, yes those days. So as I was saying, I have approximately 25 minutes to take a shower and lay back down in bed for another 10 minutes. Lol that’s pretty slothful right? So this then leaves me with about 10 minutes to get ready and about 1.5 minutes walk to the bus stop.
Not a bad routine! What makes my trip in the morning more “delightful” (that was sarcastically said by the way) is my magical golden ticket. If Willy Wanka was really thinking straight he would have offered the kids a CTA U-Pass as their prize. But I guess a tour of his chocolate factory will have to suffice. So as I was saying, thanks to my trusty U-Pass I can now travel with ease until May 09, 2012, and being a marketing major I can tell you what a huge savings this is ( anyone can see that). Finally I get to school and off to class I go, rushing like a madman on fire, as if nothing else in the world matters and this class will make or break my entire future, it might be true in some cases.
I get to my accounting class and try to stay awake; at times I feel comforted to know that I’m not the only one falling asleep in my 8 am class, but this is not to say I condone it. After this I head to my other classes with the same intensity I had for my first, but not before stopping at the UIC snack shop—yes the one in SCE by the Dunkin’ Donut. With a 20 ounce cup of black coffee in hand I feel invisible, ok well not invisible more like a kid who just had 30 pixy stixs.
Needless to say it is now time for lunch, so by this time I’m coming down off my caffeinated high and everything is now in slow motion even my speech, it’s really astounding. So I get my lunch and guess what? There is no place to sit in the Inner-circle. But as of the last two months or so I have found the perfect location to have my lunch. A place where there is always a seat and it’s typically not as noisy.
It’s the bowling alley, yes the bowling alley, most people don’t even know that UIC has a bowling alley. So I go there and eat in peace and if I have time I play some of their arcade games. The bowling alley is my oasis, it’s quite, clean and the staff is always willing to help. So when I have had a long day I head to the UIC bowling alley and unwind and think of how to apply my marketing goals to making me some money. Over the last two months I have had some of the most brilliant business ideas, and it happened mostly at the bowling alley. I encourage all students who have the available time to find a quite area such as the bowling alley and explore the creative ideas that lingers in your mind. This campus is filled with great resources go out and explore. And always remember that no idea is ever too stupid to try, if you fail at business just try again. Failure only means an opportunity to do it right the next time.
This past weekend was by far the most filling weekend I have had since the start of the year; and when I say filling I do mean filling. I designated Saturday as my all I can eat (AICE) day and placed myself up to the challenge. I decided to do nothing but eat out all day and enjoy Chicago for what it really had to offer. To begin my weekend I started off by going out for breakfast to a place called Einstein Bros Bagels, located at 180 North Michigan Ave. Needless to say this venue offered some of the most unique combination of ingredients for a bagel that I didn’t realize was possible. I ended up getting an egg sandwich Panini, which was amazingly delicious.
After breakfast I decided that it was time for me to work off some of the excess mass that I had gained. So I did, I went to the gym and stayed there for about 1.5 hours but only mustered up the strength to work out for about 35 min, lol. It’s relatively hard to do when your full and relaxed, so don’t judge. After this I figured some hot soup would do the soul some good on a cold winter’s day such as this past Saturday. So my next stop was Panera Bread, to be quire frank i don’t understand why they offer you a side of bread when all of their sandwiches already come with an ample helping of bread. However, I went in for soup and had myself a large bowl of cheddar cheese and broccoli soup that did wonders for my taste buds, after burning all that mass and calories at the gym I deserved that bowl of cheddar cheese and broccoli soup.
After which my aimless wondering led me downtown where I went perusing through stores such as H&M and others. I did this for about 3 hours with a friend, after which she said that she was hungry, unaware that I had been indulging in the art of eating all day long. In addition she stated that she was not just hungry but super hungry which meant that the only right thing for me to do was to join her on this quest and eat just as much as she did so she wouldn’t feel self conscious, lol at least that’s what I convinced myself. She picked a place to dine and I followed.
So our next stop brought us to a place called Bat Toma, this place was really trendy and right off Michigan Ave. Pretty upscale a guy like me, if you asked, moreover the food was mostly organic which kind of scared me at first, partly because some of the names on the menu I had no idea what they were. Good thing for the internet on my blackberry, with this I was able to search the names and answered questions about my food choices as if I were “highly sophisticated”. Anyways we ordered a Margherita pizza and a few drinks and decided to see a movie afterwards to work off some of my new found mass through visual stimulants—if there is such a thing. Food in Chicago is always great but it is even better with a friend.
When we think of Chicago most people tend to associate it with the magnificent skyscrapers, wonderful diners, its rich cultural/theatrical districts and head quarters to some of the biggest corporations. Chicago is a place of opportunity a place where almost anyone with an idea that seems profitable and possible can start a legitimate business. We Chicagoans are lucky to rub elbows with some of the most influential people of our time. I promise this to you, if you have the chance to stroll the magnificent mile chances are that you will run into someone influential or famous. I remember having dinner at the four season’s hotel one afternoon and right across from me was former mayor, Richard Daley and his wife, I gladly took the opportunity to introduce myself. Now that I look back at it I probably ruined his dinner, but how can a wide eye college student such as myself pass up such opportunities to clasp the hands of one of the key decision makers of my generation. My point being, Chicago is a city of hope and dreams just look at Groupon; a Chicago based company that sprouted up practically overnight and now has a valuation of somewhere close to 10 billion dollars. That’s a lot of cash! I am sure that most college students realize that working hard in school is important but so is meeting individuals who can play an integral part in shaping your career paths. So I part with this pronouncement, the city is your sandbox filled with many resources one might require, so build your castle—don’t be afraid to fail every idea is worth something it’s up to you to determine its worth. Failure is the first step to success. Each day hundreds of brilliant concepts and ideas are generated but only a few are ever implemented, take a step forward and embrace Chicago for what it’s worth. Take all that this beautiful city has to offer and when the time comes be ready to give back with a smile; that was for the future philanthropist.
A city build from dreams