Accounting Class 2 Test 3
Which two short-term liquidity ratios measure how frequently a company collects its accounts?
Days' sales uncollected Accounts receivable turnover
Profitability
ability to provide financial rewards sufficient to attracts and retain financing
Horizontal analysis
Comparison of a companies financial condition and performance across time.
Vertical analysis
Comparison of a company financial condition and performance to a base amount
GAAP
Generally Accepted Accounting Principles
Ratio Analysis
Measurement of key relations between financial statement items.
Comparative Balance Sheets
This is where you compare the assets percentage, compared to the total spent. (pg 692)
Which two ratios are key components in measuring a company's operating efficiency?
Total asset turnover Profit margin
solvency
ability to generate future revenues and meet long-term obligations.
Liquidity and efficiency
ability to meet short-term obligations and to efficiency generate revenues.