Internal Rate of Return

[Guest]

Ah, but the question is also more complicated than it seems. Due to materials, the cost of construction is higher than just what your Fixed Assets say. So your return is lower than just income / FA.

True. that's why it is a kind of balance sheet and Income statements. The fact is all building construction excepted the fix part is going in expense!

But, this discussion is interesting perhaps administrators will consider it and asking for improvements.

[Guest]

PS: We don't fight we discuss . I like to know people mind it is very important. This can improve the game and also in the future making some comparable ratio for all of us. In finance, criticizes are mostly constructives.

Good. i'm glad i'm not being misunderstood. The internet is so good at taking the nuance out of communication that i often wonder if my statements are being taken the wrong way. Either that or i'm just paranoid. The IRS sends spies to hide in the bushes in front of people's houses you know

[Guest]

Well fixed assets are not part of owner's equity either. *shrug* i'm not trying to pick a fight, it was just an observation.

Actually, fixed assets are, unless they have been built via loan.

In fact, everything will balance into owner's equity. Although for corporations this is generally classified under a few different names (Shareholder's equity and retained earnings)

[Guest]

Adding inventories to something does complicate a matter a little bit.

On one hand, they are an expense.

On the other, they are an asset.

Generally, the cost of goods is calculated only when the goods sell.

But having too much in inventory can signal a problem. The goods have to sell for there to be any benefit.

How this would calculate into ROI with a rising inventory I'm not sure. My accounting is a little rusty so i can't figure it out off the top of my head.

[Guest]

Actually, fixed assets are, unless they have been built via loan.

In fact, everything will balance into owner's equity. Although for corporations this is generally classified under a few different names (Shareholder's equity and retained earnings)

Of course everything will balance, but it is not correct to say that assets are liabilities. How the assets were obtained is irrelevant. The simple story here is keep your own books because the ingame stats aren't good enough for us bean counting types i'm just too lazy to do it.

[Guest]

Ahhhh, I love reading economic theory. It makes me feel all warm and fuzzy inside . I have my own gauge that I use to measure my companies "headway". It measures the amount of pleasure I feel inside when playing kapiland.

The gauge hasn't really moved much over the life of my company, it has always been positive and strong. Each time the gauge drops a little I gain another level which makes the "fun gauge" spike then plateau again. Who really cares if it says 10% or 20%.

[Guest]

Actually, fixed assets are, unless they have been built via loan.

In fact, everything will balance into owner's equity. Although for corporations this is generally classified under a few different names (Shareholder's equity and retained earnings)

Of course everything will balance, but it is not correct to say that assets are liabilities. How the assets were obtained is irrelevant. The simple story here is keep your own books because the ingame stats aren't good enough for us bean counting types i'm just too lazy to do it.

You are correct.

Like I said I am a little rusty since its been a few months.

Plus being exhausted dosn't help (long story).

But what I meant to say is, I think, is that fixed assets are in part owner's equity because not everything is going to be owned by a loan (they will be paid off over time.

Everything would balance into Owner's equity + Liabilities.

Although the best way to look at it would be to look at working capital (I think that's the correct term for owner's equity - liabilities?) and maybe working capital ratio.

Although this is getting a little too deep into a statement you didn't even mention (was actually a different poster). But hey, its fun for discussion

[Guest]

Well, Kapilands is a special case i think. Assets do equal Liabilities + OE, but we don't really have any liabilities in this game. Even pending contracts are iffy since payment and delivery are simultaneous. So what i'm saying is i think i understand what you were getting at when you said that fixed assets were part of OE. Since liabilities don't really exist then Assets = OE

[Guest]

Well, Kapilands is a special case i think. Assets do equal Liabilities + OE, but we don't really have any liabilities in this game. Even pending contracts are iffy since payment and delivery are simultaneous. So what i'm saying is i think i understand what you were getting at when you said that fixed assets were part of OE. Since liabilities don't really exist then Assets = OE

No.

What I was getting at was that not all the money in a corporation is financed.

[Guest]

ahhh, ok. either way i had an epiphany.

[Guest]

my ROI is about 20% per day
how do I calculate?
I calculate how much profit (Sell Price - Cost which includes supplies production cost etc) I do per day by producing then divide it to fixed assets needed to produce those.
Since I'm a ever expanding company I usually don't have any cash in my pockets therefore Income / Total gives me a negative growth

[Guest]

my ROI is about 20% per day

If that's true then your net worth should be almost 12.5 million by tomorrow and 37 million in a week. That would be impressive, but I'm a little skeptical.

[Guest]

what is a IRR

[Guest]

Check the title

[Guest]

yes but what is it what does it do what is it for