BUS100 Chapter Notes - Chapter 11: Current Liability, Accounts Payable, Financial Statement
Document Summary
Analyze the balance sheet consider date and type of business risk assessment. Qualitative outline what you will find/ found and why it is relevant to a bank loan application. Quantitative calculate current and debt to equity ratios. Recommend whether you would grant the bank loan and why. Assets: items of value owned by a firm. Liabilities: what a business owes to others (debt) Equity: profits accumulated over the life of the business plus value of the shares of the company. Liquidity- how fast an asset can be converted into cash. Accounts receivable customers who buy a product and do not pay for it immediately. Accounts payable: what the company owes to suppliers who have already sent them the product. Ratio analysis: the assessment of a firm"s financial condition and performance. Revenues: money generated by the company through sales. Net profit = net income= operating profit. Expenses: costs incurred by the company to operate the business.
