Understanding The Concepts

UNDERSTANDING THE CONCEPTS Page 1. Understanding The Concepts Melissa Young Lorna Johnson give way 100 2/26/2012 UNDERSTANDING THE CONCEPTS Page 2. 1. create mentally your be a small caper possessor. How will you read your business organisation using ratios? Compargon it to the financial ratios that be distinguished to a financial manager for a massive corporation. I am the manager of a residential tidy service. The name of the business is called Melissas Home Cleaning. We specialize in make clean the interior of the home, much(prenominal) as kitchen, bathrooms, bedrooms, dens or family rooms, recreation rooms, livingrooms, and finished basements. Our operate provided lop from dusting, sweeping, mopping, running the dishwasher, cleaning appliances, countertops, sinks, vacuuming, doing laundry, cleaning tubs and toilets, ironing and hanging clothes, wash windows, light fixtures and ceiling fans, and emptying the trash cans. Our union s assets atomic number 18 cash, inventory, accounts receivable, building, article of furniture and fixtures. My liabilities are notes and accounts payable, contingent liabilities. The do assets are about $65,000, and my total liabilities are about $18,000. My total candor is $47,000. This gives my company a 72% equity ratio.

This ratio is important to companies because it is a full indicator of leverage used by a company. 2. beg off the advantages and disadvantages of debt financing and why a organization would choose to way out stocks rather than bonds to start funds. One advantage of debt fin ancing is that it allows the founders of the! company to maintain go out and proprietorship of the company. The owner of the company does not have to dissolving agent to anyone, such as; investors or partners. The owner of the company is the scarcely one who descends to make all of the decisions. The owner will, also, own, all, the profits that are made. Another advantage is that, all, interest the owner pays on a loan is tax deductible. Interest is, usually, ground on...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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