Management and Organizational Studies 2310A/B Midterm: MOS 2310 CHAPTER 2

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2310A/B
• Professor: Jun Wang

Document Summary

Mos 2310 chapter 2: financial statements, cash flow, and. Bankers lending to businesses are looking increasingly at borrowers" cash flow as the most reliable measure of each company"s ability to repay its loans. Also known as the balance sheet, shows a firms accounting value on a particular date. Shows what a firm owns, what it owes, and the difference between the 2 (equity). Fixed assets is one with a relatively long life, can be tangible or intangible. Current assets have life of less than 1 year, meaning it will be converted to cash within the year. Shareholders equity is the same as common equity and owners equity. If the firm were to sell all their assets and pay off its debt, the remaining is what would be paid to shareholders. Difference between a firm"s current assets and current liabilities is the net working capital.