∂ Retained Earnings is an Odd Idea

~ Work on this later.

A company can do two things with its earnings. Just two. Yes, massive companies like IBM, Microsoft, Pepsi, can only do two things with all the money that they make.

One is give it out as dividends and the other is keep it, aka, retain it.

Retained Earnings: This is money the company makes from its operations, which it can either keep (retain) for future use or distribute to shareholders as dividends.

ChatGPT>

"A company generally handles its earnings in two main ways: it either retains the funds to reinvest in the business or distributes some of them to shareholders as dividends."

Comments

∂ ETFs: Cakes and Salads

~ No. My cake slice illustration for ETFs - which is not original with me - is as follows: I have a cake, perhaps of a rectangular shape, with all sorts of logos of companies on the top, made via frosting and such. So you may see the Apple logo on one corner, the google logo, sun microsystems logo, amazon logo in the middle, Aeropostale logo, or Pepsi and so on. All these are on the top of the cake and made via icing, frosting, etc. Now if I cut a rectangular slice from one corner of the cake, which has a logo of say, Apple, on it, then it is as if I got ( = purchased) shares of Apple. On the other hand, if I took a cross-sectional slice of the entire cake, from one side to the other, then I get a bit of all the companies, Apple, Amazon, Pepsi, etc. In this large but very thin slice, I get diversity. This slice is an etf. ChatGPT> That’s a great illustration! Your cake analogy effectively communicates the concept of ETFs versus individual stocks. H...

~ Currency Types in ECC vs. S/4

Currency Types in ECC and S/4HANA FI: ECC: There are indeed only 3 Currency Types in ECC: Company Code Currency: The primary currency used for financial transactions in the company code. Group Currency: The currency used for consolidation purposes at the group level. Hard Currency (or Additional Currency) S/4HANA FI: There are 10 Currency fields available in the ACDOCA: Company Code Currency Group Currency Document Currency Global Currency Free-Defined Currency 1 . . . Free-Defined Currency 6 Differences Between OB22 and FINSC_LEDGER: OB22: Primarily used for setting currencies at the company code level. Allows you to define and manage local currencies for a specific company code. The screen for "Change view additional local currencies for a company code: details" is specifically for ECC, as it only lists three local currencies. FINSC_LEDGER: A more comprehensive transaction for managing currencies and other financial ledger settings. Offers a wider range of options and f...

Primary & Secondary

A key aspect of how CO and FI are integrated within the SAP S/4HANA system: 1. Primary Cost Elements: • Example: ○ FI: Salaries expense in the P&L statement. ○ CO: Salaries expense used in cost center accounting to track labor costs. 2. Secondary Cost Elements: • Example: ○ Depreciation: While depreciation is tracked in FI, a secondary cost element might be created to allocate depreciation costs to specific cost centers or internal orders based on factors like asset usage. In SAP S/4HANA, the distinction between cost elements and costs, whether primary or secondary, is fundamental to how Financial Accounting (FI) and Controlling (CO) interact and provide granular insights into an organization's financial performance. Here's a breakdown of the differences: 1. Primary Cost Elements What they are: Primary cost elements are essentially General Ledger (G/L) accounts from Financial Accounting (FI) that are relevant for cost accounting in Controlling (CO) ....

Lem Stand Notes

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