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Jun 13, 2024 · Even better, the company's asset base consists wholly of tangible assets, which means that Solvents Co.'s ratio of debt to tangible assets is about one-seventh that of Liquids Inc. (approximately ...
Study with Quizlet and memorize flashcards containing terms like money liquidity, What is the most liquid asset?, List the following as extremely, fairly, or least liquid: 1. Checking account 2. stock certificate 3. Arts, antiques, Real estate, and Crypto 4. Mutual funds and corporate bonds and more.
Oct 21, 2024 · These assets include cash, cash equivalents, marketable securities, and accounts receivable. Liquidity ratios compare a company’s liquid assets to its current liabilities, providing a snapshot of its ability to repay new and existing short-term debt. The higher the liquidity ratio, the larger the margin of safety to cover short-term debts.
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- Cash. Includes physical money (local and foreign currency) as well as the savings account and/or current account balances.
- Cash equivalents. Cash equivalents are investment securities with a maturity period not exceeding a year. Examples include treasury bills, treasury bonds, certificates of deposit, and money market funds.
- Marketable securities. Stocks, bonds, and exchange traded funds (ETFs) are examples of marketable securities with a high degree of liquidity. They can be sold easily and it usually takes just a few days to receive the cash from their sale.
- Accounts receivable. Money owed to a business by its customers for goods and services provided makes up accounts receivable. The liquidity of accounts receivable varies.
Aug 16, 2024 · In its Q4 2022 fiscal results, Apple Inc. reported total current assets of $135.4 billion, slightly higher than its total current assets at the end of the 2021 fiscal year of $134.8 billion.
Cash Ratio. Cash is the most liquid asset a company has, and cash ratio is often used by investors and lenders to asses an organization’s liquidity. It represents the firm’s cash and cash equivalents divided by current liabilities and is a more conservative look at a firm’s liquidity than the current or quick ratios.
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May 28, 2024 · A ratio above 1 indicates that the company has more current assets than current liabilities, suggesting good short-term financial health. For instance, a Current Ratio of 2 means the company has twice as many current assets as it does current liabilities. However, an excessively high ratio might indicate inefficient use of assets.
