3.7.2 Flashcards
1
Q
What are the 3 ways businesses assess financial performance?
A
Balance sheets, income statements, financial ratios
2
Q
What is liquidity?
A
A company’s ability to be able to turn assets into cash quickly to pay off short-term obligations.
3
Q
Ways to calculate a company’s liquidity
A
Current Ratio
4
Q
What’s the equation for Current Ratio?
A
Current Assets / Current Liabilities
5
Q
Is a higher or lower current ratio better?
A
Higher
6
Q
What is an Intangible asset?
A
An asset that’s not physical in nature i.e a brand or trademark
7
Q
A
