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ACC220WK3CKPT (2) - for other companies to re-invest in...

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Explain what information would be found in each of the following groupings on a classified balance sheet, and how that data could indicate the future success or failure of a business. On a classified balance sheet there are several items that can tell another person or company if this company will fail or succeed in the future of business. One is the Current assets which is one of the major parts of the balance sheet that can be converted into cash. It can tell the future because if the current assets are low the company needs to find alternative cash funding in the meantime while it recovers. Next are Long-term investments which the company currently holds onto for more than one year. These investments can contain anywhere from stocks to bonds and can never be sold unless ordered by the court to do so. They are used in the future
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Unformatted text preview: for other companies to re-invest in these stock and bonds created. Another important item found on a balance sheet is called Property, Plant and equipment which is the total value of these three combined. Which can include land, buildings etc. that are not intended to re-sale in the future they are to stay with the company. Finally, Intangible assets are usually not of physical form they are more of a very valuable asset for the company. Intangible assets can be affected in the future if some other company tries to steal the name of the company, or try to steal documented proof of something that belongs to this company like a trademark. All four of these parts on a balance sheet are very important to have accurate and reliable information that reflects the company for the present and the future....
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