Most business owners are familiar with the big three financial documents:

• Profit and loss statement (income)

• Cash flow statement (or projection, when used for budget planning)

• scale sheet

These statements are compiled monthly, quarterly, and annually, and each provides useful information about the fiscal health of the company. The smart business owner consults these statements every month, analyzes the story that is revealed and makes decisions accordingly.

Now suppose that your company plans to launch a new product and would like to know when the expenses associated with developing and launching the product will be recovered through sales of the product at a given price. For that analysis, there is a fourth financial document, the Break-Even Analysis, which provides important forecast information.

A break-even analysis is performed when a new product or service is introduced, or a capital improvement is made. The break-even point demonstrates the point at which the sales revenue generated by the new product or service, or the payment derived from operating efficiency following the capital improvement, is equal to the expenses associated with the launch or improvement.

Run a break-even analysis to learn how products and services should be priced to recoup your company’s investment, within a given time period, and learn when the decision to invest will position itself for a profit. The break-even point allows decision makers to predict how long losses need to be sustained and how to anticipate cash flow.

The break-even point is achieved when income = expenses; The business neither makes nor loses money. Business expenses are of two types, Fixed and Variable. Fixed expenses are standard monthly operating costs. These include office space rental, insurance, utilities, and payroll. Variable Expenses are largely linked to sales: marketing, sales and advertising expenses are the main ones.

When calculating expenses, it is standard to determine the ratio of variable expenses to sales revenue. The amount of Variable Expenses is divided by the number of product units sold, resulting in the Variable Cost per Unit.

In other words, Variable Costs = units sold times variable cost per unit. For purposes of calculating the Break-Even Point, Total Expenses = Fixed + Variable Expenses (expressed as units sold times variable cost per unit). As always, sales revenue = unit price times number of units sold.

The equilibrium point is reached when:

Price times Units Sold = (Units Sold times Variable Cost/Unit) + Fixed Costs

The difference between the selling price per unit and the variable cost per unit sold reveals the amount that can be applied to Fixed Costs each time a unit is sold. Think of it this way: If your monthly Fixed Costs are $2,000 and the average price of your product units sold is $2, with an average Variable Cost of $1 each, when you sell a unit, you earn $1 to apply to Costs. Fixed. With monthly fixed costs of $2,000, the break-even point is reached when the business sells 2,000 units per month.

Knowing how many units must be sold each month to break even is essential for effective financial management of the business. The break-even point can also be calculated in terms of dollars that must be generated each month. In this example, break-even revenue is achieved at $4,000 in monthly sales, since the selling price is $2/unit and 2,000 units must be sold each month to break even.

A basic understanding of the business financial calculation process and the ability to interpret the data generated are must-have skills for all business owners and Solopreneur consultants. While it is true that the bookkeeper or accountant will perform the break-even analysis in Quickbooks by entering numbers derived from the profit and loss statement, it is always in your best interest to understand how the calculations are performed and how to make sense of them. what the financial documents reveal.

When you propose to sell a new product or service, which may be the development of a new workshop to propose and teach or some other intangible service, a Break-Even Analysis will indicate how many units must be sold, the billable hours generated. o Classes need to be delivered before production costs are recovered and the new offering is positioned to generate ROI.

Thank you for reading,

kim

You have been a very methodical person and have planned your finances well. Credit card debt has never been able to hit him as he has been very punctual with his credit card payments. Even after being so methodical in his finances, he is now heavily in debt. It was that sudden illness that struck him like lightning. After this prolonged illness, he has been struggling to settle his bills. The expense was so great that he had to take out a loan to pay his bills.

Medical bills can break your back. Illness can appear when you least expect it. If you can’t be covered by health insurance, your only option is to take out a loan to pay for medical bills. Now he’s struggling to pay off medical bills totaling more than $15,000. Your savings are not enough to cover them. Constantly thinking and worrying about how to pay off this debt can make you sick again. Wait mate, there is a way out. Have you heard of debt settlement? This is a method for you. Go to a structured settlement and erase your debt.

Medical debt is best resolved through structured settlements. It is a very good form of debt relief. You are paid a lump sum to settle your bills by taking out a loan or the bill is settled directly by the Settlement company after negotiating with the medical authorities. You pay the amount in easy installments over a period of two to three years. This is the only method to pay huge medical bills that are not advertised. Your debt settlement company can play a very important role in not only paying your medical bills but also negotiating the full amount. You can leave it to them and rest and recover after illness. With your bill worries put to rest, you can look forward to rejuvenating your body and mind. You’ll never have to look back for debt relief.

Lean Six Sigma cost, speed and quality leaps are achieved

by applying the right tools. Following the DMAIC

improvement model of Lean Six Sigma, we will see a series of

tools for each phase.

The defining phase

Purpose of Define:

This phase of Lean Six Sigma implementation identifies the

improvement opportunities and customer deliverables and defines a

scope. At the end of the definition phase, we should have a project

statute, clearly identified stakeholders, a project team,

estimation of business implications, a customer assessment

requirements, a high-level process map, and project management and

communication plans.

Tools to define:

Stakeholder analysis:

The various stakeholders (customers, shareholders, employees) are

listed and the potential impact of the improvement project on each assessed as substantial, average, low, or none.

SIPOC diagram:

Of the tools applied in this stage of the improvement project,

perhaps the most widely used is the SIPOC diagram. SIPOC Supports

for Suppliers, Inputs, Processes, Outputs and Customers. The diagram

provides a visual answer to the questions needed to understand

the process: who are the main stakeholders in this process? What

value it creates? Who owns the process? Which are the

inputs and who provides them? What resources are consumed by the

process? What process steps create value?

The steps involved in creating the SIPOC diagram and the

participation of team members in brainstorming and idea generation

sessions are as important as the resulting diagram.

VOC – Voice of the Customer:

Critical to a proper definition of the improvement project is the

availability of data that represents the views of customers and

requirements. These are collected using VOC tools such as interviews,

surveys, focus groups, comment cards, suggestion/complaint boxes

etc. The definition of customer here includes internal and external

customers.

The use of Kano analysis covers raw quantitative and qualitative data

obtained from the above in clearer expressions of the value

Customers value the various features of the products and services you offer.

The development of critical requirements for quality converts the customer

statements, which may be imprecise, to precise requirements (assessed

from the customer’s perspective) for your product or service.

The measurement phase

Purpose of the Measure:

This phase quantifies the current state of the process with respect to

at cost, speed and quality and gives an idea of ​​the gaps to be

full. At the end of this phase, we have a detailed map of the

process, data on key input and output variables, an analysis of the

process capability, refined project charter and plans where

justified by new information and recommended actions to choose under

hanging fruit.

Tools to measure:

Operational definition: several measures are defined so that all

team members apply the same definitions when collecting data for the

improvement project

Process map, value stream map, complexity value stream map:

This produces a more detailed representation of the process than

the SIPOC diagram and includes information such as waiting times,

processing time, resource

consumption, process operator, etc.

Cause and effect matrix:

This tabulates the causes against the effects and calculates the scores that

are used to classify causes. as a measure

tool, this array is used to select which inputs to focus on

due to its significant impact on the results of the process.

Preliminary FMEA (Failure Mode and Effects Analysis):

This tool is similar in function to the cause and effect matrix.

All possible input failures are considered, and then

weighted according to

probability of occurrence, severity of the impact on the products and

detection difficulty. This evaluation also helps determine

which inputs the project team should focus on.

Data collection plan:

This includes decisions about what data (balanced between input and output)

output) to collect, identification of

stratification factors (these help determine patterns in the data),

determination of sample size, identification of data sources,

preparation of data collection sheets and data transfer

Collection duties between team members.

Pareto charts:

This is one more tool to focus the team’s efforts on the most

important problems A Pareto chart is a bar

graph where the horizontal axis represents the categories. About him

vertical axis we can plot in descending order, the frequency of

occurrence, or cost, speed, or impact on quality of each category.

Where there is a clear Pareto effect, only some of the categories

(typically 20% or less) are responsible for most of the effects

(80% or more).

Analysis of measurement systems:

The process of obtaining measurements undergoes standard analysis to ensure reliability, repeatability and reproducibility. Other attributes of

measurement system are stability, bias, and discrimination.

Control charts:

A control chart is a sequence of quantitative data run charts with

three horizontal lines showing a middle centered and top and bottom

control limits. Control charts help assess the nature of

process variation. Processes under control are expected

produce data points randomly distributed around the mean but within

the calculated control limits.

Process evaluation capacity:

This tool measures process capability and assesses the capability of a

process to meet functional requirements.

There are various measures of capacity. They are all compare the

process standard deviation to the allowable range of variation as

specified by the customer.

Historically, stocks and bonds have been an excellent long-term investment vehicle. In essence, it means ownership in the businesses that power the world. As the world grows, so do the underlying companies and stocks that are its foundation. Financial markets are no longer dictated by a few powerful exchanges like the New York Stock Exchange and Deutsche Boerse (Germany), but are affected by a vast, complex and interconnected network of financial pick-up sticks. Of course, there are many ways to invest in these global corporate-owned slices, but for now we’ll leave the alluring, if risky, methods of trading stocks involving derivatives, forex, and day trading for other columns.

Lusha, the investment guru

Investing in stocks and bonds is very simple in principle: buy low and sell high. Easy enough, in fact, fortunes have been made by men with PHD’s and MBA’s besides their names and financial network television celebrities who have written volumes on trends and charts and flash indicators and stochastics and investment psychology and even rally based on whether the Dallas Cowboys win or lose. They are all experts and they all have different opinions, literally thousands of opinions. There’s also a now-famous chimpanzee in Russia named Lusha who spews her defecation at a stock listing on a chart, and those stocks have tended to match or beat the picks of some of the world’s most sophisticated analysts. What does this tell us? That buying low and selling high is not that easy or, better yet, we can choose to pay big analyst fees or hire a primate at a much lower cost to be our stock picker.

Indicators and Common Sense

A good place to start when buying stocks, bonds, and mutual funds is to learn a little about indicators. These are tools that provide an analytical look at a company and its relative stock price. One of the most common is the P/E ratio (Price Earnings Ratio) which analyzes the current price of the stock in relation to its earnings per share. That makes sense! The P/E ratio is simply the stock price divided by earnings per share (which can be found in any number of financial publications). A high P/E ratio could indicate that a stock is overvalued and a low P/E ratio could imply that a stock is undervalued, but this is only an indicator and is completely unstable. As an example, during the dot-com bubble, some companies had no earnings as in a zero P/E ratio…nothing…a big fat donut…and yet these stocks were sold for the price clouds. Which brings us to the most important indicator you can use. It is found in the six inch wide analyst hidden between his two ears.

Warren Buffet said, “Invest in what you know.” For example, perhaps he agrees that there is an aging post-World War II baby boomer population. What does that mean? It could mean that companies that sell services or products to seniors will do well for years to come. You can invest in a startup called FN Walkers Inc. (fictional) that has developed a compact titanium walking device with a built-in espresso maker. The company is reporting sky-high backorders. Or you could consider Government Bonds. These are generally the safest investments on the planet and tend to do well in times of turmoil. Why? Because investors run to safety faster than squirrels on a golf course. When missiles start firing around the world, investment dollars flow like rivers to safe havens, and consequently the price rises. With bonds, forget stochastic oscillators and 10-year moving averages and pray for instability and bad news!

After all, you don’t need an expensive investment guide or a pooping chimp.

Diversify by putting your eggs in one big basket

There is another way to buy stocks and bonds. It is through mutual funds. A mutual fund is simply a managed collection of stocks, bonds, or commodities that are kept in one big basket and managed by really smart people. Mutual funds come in many packages, like funds based on Dow Industrial Stocks or growth companies or corporate and government bonds, or pharmaceuticals or emerging markets, say in China or Brazil. The theory is that owning a small part of a hundred shares is safer than owning a large amount of a single share. Another advantage of owning mutual funds is that they are completely liquid, which means you can get out of your position almost immediately. Mutual fund returns are largely based on the fund manager’s experience and results can be closely monitored in many cases with a 1-year, 5-year, 10-year, or even 20-year moving average.

This Author’s Favorite Reason That Needs Anger Management Counseling

Always, Always, Always, listen to the advice of your brokers or the advice of so-called experts. On October 9, 2007, the Dow Industrial Average reached an all-time high of $14,164. After that, it began to free fall like a base jumper without a parachute and finally hit hard at a low of $7062 on Feb 27, 2009. The investment gurus were telling us to hang on…the market will recover. Poppycock, Fubar!!! It’s best to sell stocks as high as possible to get out, then get back in when they convulse in a splattered heap on the ground. If you went out some time after the market started to sell off and then went back in after the dust settled, you’d be in a substantially better position than just letting the investment flow in fact even though the market is now dancing around 12,000 you. it would still be 15% BELOW the market high of $14164. Isn’t that what brokers are supposed to do?

I get sick on fast roller coasters anyway.

Ten thousand dollars is a good starting point if you are interested in any type of investment. Obviously, the safest and most risk-free option would be to deposit it in a savings account with the highest interest rate you can get. However, that is not enough for many people. There are more profitable strategies; Also, you may not want to put all your money in one place. When thinking about the best way to invest $10,000, it’s important to consider not only the traditional options, but also the newer ones.

One of these “newer” types of investment is the peer-to-peer lending platform which involves joining an online platform where investors can become “lenders” to other people who need money and don’t want to go through a big bank or financial institution. lender. With peer-to-peer lending platforms, you can spread your investments into hundreds of loan increments for as little as $25 – $50, depending on the platform you choose, and earn around 5% per year on each interest. However, you could earn a higher rate of return by spending more money and making riskier loans.

EFT should also be considered. “Exchange-traded funds” can contain a wide variety of investments, including commodities, bonds, and stocks, some of which are US-only holdings, while others are international. The benefit of opting for an EFT instead of buying shares individually is that there is a low expense ratio and fewer broker commissions to worry about.

The best way to invest $10,000 online

One of the best ways to invest ten thousand in the 21st century is to use an ONLINE bank that offers CDs. Since online banks don’t have physical branches across the country, they don’t need as much overhead and operating expenses and are therefore in a better position to offer customers higher CD rates than the traditional brick-and-mortar type of bank. . .

CDs can be more profitable than savings accounts because with CDs, you agree to deposit and keep your money in the account for a set period of time, called the “term length.” During that time, you will not have access to the funds and if you make an early withdrawal, there could be a penalty.

Another great advantage of living in the 21st century is that you don’t need $100,000 to invest in real estate. You can still do it with $10,000, as long as you look for REITs (real estate investment trusts). These types of businesses own/finance income-generating real estate in a variety of sectors (retail, lodging and resorts, self-storage, healthcare, residential, etc.) in different geographic areas.

If you’re not sure what the best way to invest $10,000 is, join the Motley Fool. You’ll get all the educational tools and resources you’ll need, including free advice, on the best places to invest your money and the best stopping places from leading experts.