What is an Unlevered Free Cash Flow? Unlevered free cash flow (UFCF) refers to the money available to a company without interest payments. It is the cash flow of a company based on the belief that the company owes no debt therefore has no interest payments to make. When filing the financial statement of a company, UFCF are also reported. This is the...

Professional Etiquette and Office Visitors Depending on your position, it may be common or uncommon to have people (insider or outside of your company) visit your office. It may simply be for a meeting or it may involve a tour around the office.  This scenario is often overlooked in terms of demonstrating professionalism and establishing your brand....

What is Weighted Average Anti-Dilution? The most common anti-dilution protection is called weighted-average, anti-dilution protection. This approach employs a formulation adjust the rate at which preferred stock converts into common stock, based upon: the amount of money previously raised by the company, the price per share at which it was raised, t...

What is Economic Efficiency? Economic efficiency refers to an economic situation where there is an optimum allocation or distribution of resources with minimum waste and inefficiency.  What is Allocative Efficiency? Allocative efficiency seeks to produce an amount that maximizes the benefit to society. An allocatively efficient economy produces an "...

Are there Exemptions from Antitrust Law? Businesses in certain industries may be exempt from some of the antitrust provisions of the Sherman Act. These businesses do not receive a blanket exemption; rather, they receive specific exemptions for certain practices or activities. What businesses are exempt from the provisions of the Sherman Act? Busines...

What is business governance? Business governance concerns the actions and controls placed on those charged with managing a business entity. Business governance is the subject of extensive legislation and research, particularly as it pertains to the corporate entity form. Corporate governance generally concerns the internal control of a corporation a...

What is Additional Paid In Capital? Additional paid-in capital refers to the additional amount that an investor pays beyond the par-value of a stock issued. In a balance sheet, this excessive amount is considered a part of contributed surplus account under shareholders equity. One can create this additional paid-in capital with issuing either common...

What is the rule of law? The rule of law is the orderly passage and execution of laws by a governing body. How Does the  Rule of Law Work? In the United States, a representative democracy, laws exist to serve or represent the interests of the greatest number of people.  Enforcement of the law is done to both maintain order within the community and t...

What is the Tax Basis of a Business Entity? Basis is largely a tax concept. By definition, basis is the value that an individual pays for an asset. If the asset is later sold or disposed of for a higher amount, there is a gain. If it is sold for a lower amount, there is a loss. One unique aspect of basis in a business entity is that it includes the ...

What is the Crowding Out Effect? The crowding-out effect is an economic theory that states that increased government spending effectively reduces total private spending.  What Causes the Crowding Out Effect? Increase government spending causes higher demand for capital in the market. The higher demand for capital causes a rise interest rates (i.e., ...