Certain industries are subject to peculiar financing and operating conditions calling for special consideration in drawing distinctions between current and noncurrent. How should analysis recognize this in evaluating short-term liquidity?
Answer to relevant QuestionsYour analysis of two companies reveals identical levels of working capital. Are you confident in concluding their liquidity positions are equivalent?Assume a company’s days’ sales in receivables is 60 days, compared to 40 days for the prior period. Identify at least three possible reasons for this change.Identify important qualitative considerations in the analysis of a company's liquidity. What SEC disclosures help our analysis in this area? When is information on unconsolidated subsidiaries important to solvency analysis? A company you are analyzing has a purchase commitment of raw materials under a noncancelable contract that is substantial in amount. Under what conditions do you include this purchase commitment in computing fixed charges?
Post your question