Lafury business

• What are the fixed assets in a balance sheets

  factory, office,machinery
• what are the current assets in a balance sheets

  cash stock/inventory and debtors/receivable
• What are the current liability in a balance sheet

  overdraft and creditors
• What are the equity in a balance sheets

  Owner investments and retained profit.
• What's the other phrase for a balance sheet

  Statement of financial position
• what are assets

  assets are resources owned by a business. Some are fixed (they are hard to turn into cash quickly) and others can turn into cash with in a short period.
• What are liabilities

  money owned which is also considered a source of finance. SOme liabilities are short term and need to be paid back quicklt such as (current)
• what is capital

  money invested in the business (retained profit + share capital)
• what is current ratio equation

  Current asset

  _________

  current liabilities
• what is the equation for acid test

  Current asset- inventory

  _________________

  current liabilitie
• what is the optimal ratio for current ratio

  the optimal ratio is between 1.5:1 and 2:1 . A significantly low ratio can be detrimental to a business since they will not be able to pay off their short term debts. A high ratio mean the company has too much cash wrapped up in assets that is should invest.
• what is the optimal figure for acid test ratio

  the optimal figure falls between 0.75 an 1.00. A low acid test ratio shows that the business will have problems affording to pay off short term debt which lead to serious financial trouble. High means a business is wasting money on current assets.