PQ w3(1) - ACCT1501 2011Sem2 Preparation Question Solution Preparation Questions DQ 2.1 2.6 P2.17 Case 2A DQ2.1 If you had trouble with any of the

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ACCT1501 2011Sem2 Preparation Question Solution 1 Preparation Questions: DQ 2.1, 2.6; P2.17; Case 2A DQ2.1 If you had trouble with any of the terms, the glossary will help you. DQ2.6 a. A balance sheet can indicate whether a company is financially sound by a comparison of the amount of finance raised by debt with the amount raised from owners. The higher the proportion raised by the debt, the higher the risk to the creditors. b. The working capital, i.e. current assets less current liabilities indicates a company’s ability to pay its bills on time. This assumes that the current assets can be readily turned into cash. c. To declare a dividend a company must have adequate cash (or overdraft facilities) and adequate retained profits. The decision will be influenced by shareholder expectations. d. The age of equipment can be ascertained by comparing cost of equipment to accumulated depreciation. Problem 2.17
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This note was uploaded on 10/20/2011 for the course COMMERCE 3502 taught by Professor All during the One '11 term at University of New South Wales.

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PQ w3(1) - ACCT1501 2011Sem2 Preparation Question Solution Preparation Questions DQ 2.1 2.6 P2.17 Case 2A DQ2.1 If you had trouble with any of the

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