Income Statement – A financial statement that is one of the three important financial statements used for reporting a company’s financial performance over a specific accounting period, with the other two key statements being the balance sheet and the statement of cash flows. The income statement primarily focuses on the… Read More »Delta Tuesday Term – Income Statement
Seller's Discretionary Earnings (SDE) – It is the Total Owner Benefit a business produces. Generally, it is used for evaluating businesses with gross annual sales that are under $1,000,000. For businesses over $1,000,000, EBITDA is generally used. How Small Businesses Are Valued Based on Seller’s Discretionary Earnings (SDE) Public companies… Read More »Delta Tuesday Term – Seller’s Discretionary Earnings
A contractual provision stating that the seller of a business is to obtain additional future consideration based on the business achieving certain future business goals. An earn-out is a mutually beneficial tool to getting a deal done if it is structured appropriately. Is maximizes the selling price for the seller… earn-out/" class="" rel="bookmark">Read More »Delta Tuesday Term – Earn-out
All or a portion of expenses that are added back to net income in an effort to place the figures as close as possible to the economic earnings that were actually derived from the business. from https://www.dummies.com/business/corporate-finance/mergers-and-acquisitions/what-add-backs-are-legitimate-in-an-ma-deal/: “The theory behind these add backs is that these expenses are purported to… Read More »Delta Tuesday Term: Add-backs