Vertical integration is an economic term that describes the merging of two different types business into one or the merging of two different lines of production within one business. What makes this type of merging, or integration, vertical is the fact that one of the businesses or lines of production is different from the other. This tactic is often an industry response to sharing limited or scarce resources.Know More
Usually the difference between the businesses that causes vertical integration is their level of production, but sometimes supply and demand starts the process. Vertical integration occurs any time company productivity increases following a merger of departments or businesses. Vertical integration is not always a change in the way companies do business or the work they perform. For example, an orange juice manufacturer may decide to buy their supplier in order to cut costs without changing the day-to-day operation of either business.
Before a business attempts a vertical merger, they need to know that the process is relatively expensive and often difficult to reverse. Vertical integration is an aggressive move to edge more profits from resources and customers. Other types of integration, like forward integration, that involve growing are similar to vertical integration.Learn more about Financial Calculations
"B2B sales experience" means the job candidate must have experience selling from one business to other businesses. B2B sales experience contrasts with retail experience, also known as B2C, where the employee sells to individual consumers.Full Answer >
According to Investopedia, to calculate an annual growth rate, take the ending value and divide it by the beginning value. Place that amount to the power of one over the number of years of growth, and subtract one from that amount. This averages growth over a period of years.Full Answer >
Depreciation recapture is calculated by adding back the depreciation expense to date that has been taken on an eligible asset after it has been sold, notes About.com. The purpose of the depreciation recapture is to properly allocate tax rates to a gain on the sale of an asset.Full Answer >
A trade discount journal entry is an accounting term that refers to the amount paid for a good or service as opposed to the list or invoice price, according to Principlesofaccounting.com. For example, a merchant may offer a customer a 20 percent discount on a service priced at $1,000.Full Answer >