Financial record keeping. Assets Current Assets a)Items that are tangible and can quickly be...
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Transcript of Financial record keeping. Assets Current Assets a)Items that are tangible and can quickly be...
Financial record keeping
AssetsCurrent Assets
a) Items that are tangible and can quickly be converted to cash or that will be sold within12 months
Examples are … cash on hand, checking and savings accounts, stocks, money others owe you, current non-depreciable inventory, livestock, crops and feed
• Non – Current Assets (Long term)a) Items that have a useful life of more than one
year and are used in the business – b) Examples… non-current , non depreciable
inventory, land
Intermediate Assets – depreciable inventory
Examples .. Machinery, equipment , breeding livestock, cash value of insurance, personal vehicles, household goods
LiabilitiesCurrent Liabilities – accounts and notes
payable, this year’s part of non-current liabilities
Non – current liabilities – mortgages and other debts not due this year
Total liabilities = current liabilities (debts) +
non – current liabilities (debts)
Net Worth or owner’s Equity =total assets minus total liabilities
• Debt-to-Equity Ratio = total liabilities /net worth