what procedure would you adopt to study the liquidity of a business firm? who are all the parties interested in knowing this accounting information? what ratio or other financial statement analysis technique will you adopt for this.
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we can calculate current ratio and acid test ratio.
there are plenty of parties who are intrested in accounting information: creditors,investors,bankers,government etc are some of them.
there are plenty of parties who are intrested in accounting information: creditors,investors,bankers,government etc are some of them.
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By making a comparison of the liquidity ratio that is comparing the firms most liquid assets with the short term liabilities among a business, you ca study the liquidity of a firm
Parties interested:
1. Customers.2: General Public.3: Government.4: Tax Authorities.5: Money Lenders, Bank or other money lending institutions.6: Potential Investors.7: Management.8: Researchers.9: Investors-Long term , Short term..
Parties interested:
1. Customers.2: General Public.3: Government.4: Tax Authorities.5: Money Lenders, Bank or other money lending institutions.6: Potential Investors.7: Management.8: Researchers.9: Investors-Long term , Short term..
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