In financial statements numbers are sometimes given with parentheses around them, while other numbers appear without parentheses. What does it mean if a number is enclosed by parentheses?
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It means the number is negative. It's an alternate way of showing negative numbers versus prefacing with a negative sign (-)
In some cases, a negative value also has a different name. For example you'll often see
Net Profit (Loss) : (10,000)
Where the parentheses means that it was a loss and not a profit. Mathematically it's the same as a "negative profit" but it is used to keep headings consistent (it would be harder to analyze than if you used a different heading to indicate a profit or a loss).
D Stanley
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- 20
- 333
- 404