Pipeline Theory – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is the Pipeline Theory?Pipeline theory is the notion that an investment firm passing every return on to clients shouldn’t be taxed like regular companies. Pipeline theory includes dividends, capital gains, and interest as returns which should be considered....

Pink Sheets – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What are Pink Sheets?Pink sheets are a listing service for stocks that trade through over-the-counter (OTC) transactions. Pink sheet listings are companies that are not listed on a major exchange such as Nasdaq or the New York Stock Exchange. Stocks that are listed on...

Perpetual Inventory – Explained

by TheBusinessProfessor | Feb 23, 2025 | Operations, Project, & Supply Chain Management

What is Perpetual Inventory?Perpetual inventory refers to a technique of accounting that records inventory purchases or sales immediately via the use of enterprise asset management software and computerized point-of-sale (POS) systems. The perpetual inventory provides...

Default Risk – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is a Default Risk?How Does a Default Risk Work?Indications of Increased Default RiskInvestment Grade vs. Non-Investment GradeKey Takeaways  What is a Default Risk?Default risk refers to the chance that individuals or companies would be...

Constituent (Market Indexes) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is a Constituent?How Does a Constituent Work?Requirements of ConstituentsBenefits of Index Funds What is a Constituent?A constituent refers to a company or stock that belongs to a bigger index, like the Dow Jones Industrial Average or the...

Business Tax Credit – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is a Business Tax Credit? Business tax credits refer to credits available to individuals and business owners when they file their annual tax returns. Businesses use credits to reduce or offset their tax liability. Generally, tax credits reduce the taxes an...

Business Credit Score – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Finance, Personal Finance, and Valuation Principles

What is a Business Credit Score?A business credit score refers to a number that measures the business creditworthiness. It determines whether a business qualifies for a loan. The calculation of a business credit score is based on a number of factors like the business...

Carryover Basis – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is Carryover Basis?A carryover basis is a method used to determine an assets tax basis when transferring it to another person. The use of a carryover happens when an individual gifts another person the asset. In this case, the basis will generally be the same as...

Clearing Corporation – Explained

by TheBusinessProfessor | Feb 23, 2025 | Banking, Lending, and Credit Industry

Update Table of Contents What is a Clearing Corporation?How Does a Clearing Corporation Work?Example of How a Clearing Corporation WorksWhy is the Clearing Corporation Important?Key Functions of a Clearing CorporationClearing Corporations vs. Future Contracts What is...

Surtax – Explained

by TheBusinessProfessor | Feb 23, 2025 | Business Taxation

What is a Surtax?Surtax refers to a tax that is charged on the tax itself. It can be ascertained in the form of a percentage of a specific amount or it can be charged as a flat dollar amount. Surtax is also called a tax surcharge.How Does a Surtax Work? A surtax is...