There are very few financial indicators that are as important and well-known as EBITDA. It stands for Earnings before Interest, Taxes, Depreciation, and Amortization. This is a popular measure because it gives us an idea about a company’s operating profitability. Very often, EBITDA serves as a proxy for operating...

Cash flows arise from the operating, investing, and financing activities of a company. When it comes to cash flows from operations, the standards allow us to choose between two distinct approaches. They are commonly known as Direct and Indirect methods. Direct Cash Flow Statement Companies applying the Direct method disclose...

Common-size income statements present their line items as a percentage of revenue, common-size balance sheets present their line items as a percentage of total assets. What would common-size cash flow statements compare their line items to? The Cash Flow Statement The cash flow statement usually starts with net profit,...