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BU127 Full Course Notes
The acquisition of assets is financed from two sources: The mix of debt and equity for a company is called the capital structure. Liabilities are recorded at their current cash equivalent, which is the cash amount a creditor would accept to settle the liability immediately. Defined as probable debts or obligations of the entity that result from past transactions, which will be paid with assets or services. Quick ratio = quick assets / current liabilities. An important indicator of a company"s ability to meet its short- term obligations. Bauer sports has quick assets (cash, short-term investments, and net receivables) of. Lo1: accrued liabilities are expenses that have been incurred before the end of an accounting period but have not yet been paid. Cost of sales average trade payables: measures how quickly management is paying trade accounts, a high trade payables ratio normally suggests that a company is paying its suppliers in a timely manner.