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What is an Annualized Return?

July 18, 2021 admin Comments Off on What is an Annualized Return?

When investors seek to compare the performance of two assets over time, they need to look at annualized return. Why this metric, specifically? Because it takes into account asset performance, time, and compounding—the most important factors attributing to performance. Annualized return is the yearly rate of return for a given asset over a defined period of time. It is also known as the compounded annual growth rate (CAGR).
Investors who understand the meaning of annualized return and what it represents will find themselves able to better-track the performance of assets against each other. It’s a metric that’s not difficult to calculate, …read more […]

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What is Accrued Revenue?

July 17, 2021 admin Comments Off on What is Accrued Revenue?

There are many industries where companies provide goods or services, but aren’t immediately paid for them. From an accrual basis accounting standpoint, these represent accrued revenue for the company. Technically, they’re assets until they’re realized as revenue, recorded as such on the balance sheet. This revenue accrues for as long as the company provides good or services, up to the point they issue an invoice and get paid for them.
Recognizing future revenue as the company delivers goods and services helps to better-balance its books and paint a more transparent picture of its financial health. Here’s a look at what …read more […]