the average period of time between the use of cash to deliver service or buy good for resale and the subsequent collection of cash from customers who purchase those service and products. Liqudity determined by the ability if an asset to be readily converted into cash.
-the average period of time between the use of cash to deliver service or buy good for resale and the subsequent collection of cash from customers who purchase those service and products.
Liqudity
determined by the ability if an asset to be readily converted
into cash.
ex: current assets, cash, short term investments, accounts receivable,
inventory, other assets, and total assets
Long Term Assets
-property,plant, and equipment
-Intangible Assets
-Consists of land,buildings,equipment,vehicles,furniture, and
fixtures that a company uses (capital expenditures/investions)
-consist of brand names, copyrights, patents, and trademarks that a company
acquires
-other long term assets: resources
ex: long-term marketable securities
Current Liabilities (long term liabilities)
– liabilities that must be settled within the normal operating
cycle
ex: accounts payable, accrued expenses, deferred revenue, and short term loans
-debt obligations not due to be settled within the normal operating cycle
ex: long term notes payable, bonds payable, unfunded employee retirement plan
Stock Holders Equity
-the residual interest in the assets of a company that remains
after deducting its liabilities
-Account form= assets are displayed on the left side and the liabilities and
stock equity on the right
-Report form= assets displayed at the top, without liabilities displayed below
the assets and stock equity below liabilities
Income Statement Classification and Analysis
(single step income statement, multi step income statement)
– simplest form of an
income statement. the sum of the expenses is subtracted from the sum of the
revenues in a single step to arrive at net income
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