Chapter 6 Outline - Chapter 6 Liquidity of Short-Term...

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 6 Liquidity of Short-Term Assets; Related Debt-Paying Ability The Operating Cycle Cash Inventory Accounts Receivable Cash Current Assets Cash Restrictions on cash Compensating balances Specific restrictions for short-term creditors Cash and cash equivalents Marketable Securities(Short-term investments) Marketable Intent to convert to cash in the short-term Carried at fair market value Trading Available for sale Held-to-maturity (debt) Types 1. Equity securities 2. T bills 3. Govt bonds 4. Corp bonds
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Receivables Accounts receivable Trade receivable Note receivable Allowance for Doubtful Accounts 1. Match sale and bad debt expense 2. Based on an aging of accounts receivable 3. Usually shown net of allowance Long-term Receivables 1. Face amount of note has no interest or is unreasonable 2. Valued at present value 3. Difference is interest Long-term receivables may be shown as current when industry practice 1. Installment sales 2. Note disclosure required 3. Reclass for analysis purposes 4.
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern