Tag: Current Liabilities
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Working Capital Cycle
The college textbook definition of working capital is current assets minus payables and accrued expenses. The term explains the dollar value of flexibility a business operation has to take advantage of immediate opportunities or endure sudden or long-term setbacks. Since it is a balance sheet based formula the value is a function of a moment…
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EBITDA – Buyer Beware (Case Study)
This article will illustrate the opposite effect using the same business information. A buyer of a business should be leery of financial information and look for improper accounting processes. The goal is to reduce the operational income and ultimately the value of the business. The goal is to get the business valuation to a realistic…
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Bookkeeping – Proper Balance Sheet Presentation (Lesson 20)
The balance sheet serves as an historical report. It identifies the accumulated change in value since inception.
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Working Capital Management – Fundamentals
Working capital management is a function of finance whereby management ensures adequate cash is available to meet operational needs over the typical working capital cycle.
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Working Capital
Cash is the lifeblood of every business. Without cash a business operation can come to a standstill. Cash is one component of working capital, a term referring to current assets (Gross Working Capital) less payables and accrued expenses.
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Bookkeeping – Debits and Credits in Liability Accounts (Lesson 5)
Whenever a business commits to purchase time or product and that employee delivers their time or the supplier delivers the product, you owe them money. This is a liability.
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Construction Accounting – Balance Sheet Construction in Process Accounts
Construction accounting consists of three major groups of accounts. The first and most understood set are the cost of construction accounts found on the profit and loss statement.