1.What is Assets and Current Assets Definition Asset: In accounting terms, any tangible (physical resources) or intangible (nonphysical resources) that can be possessed or controlled to create positive monetary value is known as Asset. In other words, anything that can be transformed into cash value is termed as asset. This includes: • Real Estate Assets: Building, land and any other physical immovable structure. • Personal Assets: Substance that you claim which is not a genuine property, for
important in Zynga’s case mainly because Zynga does not have to maintain inventory. Inventory is an asset which normally must be floated with cash, which comes in part from collecting on Accounts Receivable. This is part of the cash conversion cycle. Zynga’s current accounts receivable management is also less important because accounts receivable is a very small portion of Zynga’s total current assets. Also, when Zynga’s products are sold online, cash payment is received instantaneously through one
the numbers show that Ajax electronics is struggling and always seemed lack of cash. Sales growth after 2000 were only 9%, which the average annual sale growth rates range from 10% to 30% in their industry. The lack of cash is explained by the current liquidity ratio
States. Assets, Liabilities & equities are measures as per the standards mentioned by the US GAAP. Company has used fair value measurement for certain assets and liabilities which as per the GAAP are required to be recorded in fair value on a recurring basis .Further some of the assets and liabilities are also recorded on fair value which comes under the category of non-recurring fair value measurement usually due to the impairment charges. Recording of Asset, Liabilities & Equity. Assets such as
This is true with any company that wishes to gain shareholders and is common practice with organizations that after completing their financial calculations, turn the project over to human resources to enhance the beauty of the package. Coca-Cola’s current ratio, which “is a widely used measure for evaluating a company’s liquidity and short-term debt-paying ability”, dropped from 1.1:1 in 2004 to 1.04:1 in 2005. (Wegandt, Kimmel, & Kieso, 2008 p 707) This indicates a slight drop in Coca-Cola’s liquidity
Together both PepsiCo and Coca Cola are both companies that are known around the world for their goods. For decades now, these companies have been competitive against each other to “do better than” the other one, what some would call the “cola wars”. They individually offer a assortment of soft drinks; regular, diet, caffeine free and many other options for the public to choose from. Both of the companies also have quite a few different entities (or off springs) of their company, such as bottled
negative for company. Decreasing of the profit margin and ROE also is related to asset efficiency. Asset efficiency tests on efficiency of management in the used of assets to increase sales revenue, and it includes asset turnover. The asset turnover ratio decreased over the past four years as well (1300SMILES, n.d.). Since the company’s profit margin, ROE, and asset turnover fell down, the sales revenue per one dollar assets would go down. It would also hard for 1300SMILES to maintain a high degree of
Revenues have been increasing each year since before 1996 with profits coming from product line of automobiles and motorcycles. In 2001, BMW came out with a new product group, the Mini. The Mini also contributed to the revenue increase in 2001. BMW has current developments in their sports cars, the Z8. BMW has created a trustworthy name for the automobiles they produce and has all the potential to continue their success in the future. Audi, one of Germany’s first automobile producers, has been designing
For many ratios, including the quick ratio and current ratio, there has been a decline in 2014 alone. As an investor this would be a good sign to wait until another set of financial statements are available. While many of these
use their internal funds instead of external finance because it helps the company to save cost. Expenses such as origination fees and interest are avoided. There are several types of internal funds such as retained profit, working capital, sale of assets and depreciation (McMahon, 2014) Retained Profit Definition: It is a part of the net profit which is seen in the income statement. This profit will be put back into the company. Retained profit is restored into the company. It can be seen under the
accounting transaction to be measured at its historical costs. Historical cost can be defined as a degree of value utilised in accounting in which the cost of an asset is based on the original price when the asset is obtained by the organisation. For instance, 200 units of an item were bought two months back that cost $10 per unit. However, the current price is $12 per unit. Hence, the inventory will show at a cost of $2000 instead of $2400 on balance sheet. The advantage of employing historical cost is
Given: Current Assets = $25,000; L = $40,000; OE = $55,000 Non-Current Assets = $95,000 - $25,000 Non-Current Assets = $70,000 2-1 D. Given: Current Ratio = 2.2:1; Current Asset = $33,000, Non-current Asset = $55,000; Liabilities = $15,000 Current Liabilities = Current Assets / Ratio Current Liabilities = $33,000/2.2 Current Liabilities = $15,000 OE = Total Assets - Total Liabilities OE = $88,000 - $15,000 OE = $73,000 2-1 E. Given: Non-current Assets = $60,000; Total Assets = $95,000;
differences. These temporary differences are differences between carrying amounts of an assets or liabilities in the financial statement of financial position and its tax base (Choo & Lazar, 2014). There are two types of temporary differences which are taxable temporary differences and deductible temporary differences. A taxable temporary difference indicates that a taxation liability has been deferred in the past or current period and company will pay more in the future whereas deductible temporary differences
wages and this should be added at the Less Current Liabilities. Another adjustment that I made is the general expenses, I added the general expense under the current assets because it is already paid so the total current asset is changed to 129,680. Total current liabilities should be subtracted from total current assets which is 94,680. Then, to get the working capital, I added the total of non-current assets to the difference of current assets and current liabilities which is 108,520 then I subtracted
Assets are an important part of any business or organization. Assets are resources that add value to the business, fund daily operations and are used to pay expenses that have been incurred by the organization. Assets are listed on the balance sheet of an organization’s financial statements, which can be used for decision making by owners, management, investors and creditors of an organization. There are two different classifications of assets recognized on the balance sheet: current and noncurrent
Final Project: Financial Analysis The best way to determine whether to invest in a company is by reviewing the financial statements of the company. The purpose of this paper is to do a financial analysis and discuss the annual reports for two of the major beverage companies, PepsiCo, Inc. and the Coca-Cola Company, particularly the Consolidated Statements of Income and the Balance Sheets for each company. Both PepsiCo, Inc. and the Coca-Cola Company manufacture and sell bottled water, energy drinks
1.Liquidity Analysis 1.1 Current Ratio Definition: The current ratio is a financial ratio that measures whether a firm has enough resources to pay its debts over the next 12 months. It compares a firm's current assets to its current liabilities. In other words, it shows how much that a company must pay it 1 rupee of liability. Theoretical Concept: The current ratio gives a fare view to investors and creditors to understand the liquidity of a company how quickly a company is meets its short-term
final dividend. Assuming they pay the final dividend using cash, it will reduce the bank balance from current assets and will also reduce the retained profits that are recorded under Equity in the Statement of Financial Position. However, according to Liu & Espahbodu (2014), paying dividend will give a stable flow of earnings to Foxgloves Ltd., which can later choose to spend on new non-current assets or reinvestment. Furthermore, Alex and Will will receive a more stable income because dividend is added
measure how liquid a company by comparing all components in current assets and current liabilities components. There are two assessments to measure this ratio, as follows: If the company is able to meet its obligations, it can be said the company is liquid Otherwise, if the company is unable to meet those obligations or cannot afford, it can be said illiquid. Liquidity ratios used in this study is Current Ratio: Current ratio Current ratio is a ratio to measure a company’s ability to pay short-term
PARAMETER LIQUIDITY RATIOS Current Ratio Current Ratio= Current asset/ Current liabilities Current assets for the year 2013-14 is Rs. 959.57 (in crores) A current liability for the year 2013-14 is Rs. 634.44 (in crore) Current ratio for the year 2013-14 is 1.34. It has increased from 0.87 to 1.34. Quick or acid test or liquid ratio Quick ratio= liquid assets/ all current liabilities-BOD Liquid assets for the year 2013-14 is 418.74 crores Current liabilities including BOD is 634.44 crores Therefore