Common shareholders have the lowest claim on the assets of assets of a firm. They have only a residual claim on the assets and are far below the preferred stock classification.
Networth
Creditors.
a - lenders
Lenders does.
___ measure how effectively a firm manages assets to generate revenue
liquidity position of a firm is the amount of liquid assets ,that is, cash ,bank balance and those assets which can be converted into cash as and when required by the firm which is owned by the firm currently.
bondholders.
Networth
a - lenders
Creditors.
Lenders does.
bondholders.
The amount of cash liquidates possessed by a firm are its assets. The amount of credit lines extended to (and available) by a firm are considered liabilities.
They should determine how much the firm should invest in assets and how much cash should be raised.
Cash flow from assets measures the cash flows generated by the firm's assets.If a firm is new, or if it's investing heavily to promote growth, its cash flow may be negative.Cash flow from assets may calculated in the following way:Operating Cash Flow - Net Capital Spending - Change in Net Working Capital (NWC)Here's a breakdown of those components:Operating Cash Flow = EBIT + Depreciation - TaxesNet Capital Spending = Ending net fixed assets - beginning net fixed assets + depreciationChange in NWC = Ending NWC - Beginning NWC*where NWC is Current Assets - Current Liabilities
Rapidly expanding sales will require a buildup in assets to support the growth. In particular, more and more of the increase in current assets will be permanent in nature. A nonliquidating aggregate stock of current assets will be necessary to allow for floor displays, multiple items for selection, and other purposes. All of these "asset" investments can drain the cash resources of the firm.
Capital assets, also referred to as capital goodsand plant, property and equipment, are a kind of non-current asset. The main purpose of these assets is generating revenue for an entity by being used for one or more purposes. An example of a capital asset is a delivery truck used by a delivery firm; the truck helps to generate revenue for the firm as they use it to provide delivery services. A firm does not sell capital goods to generate revenue (as they would sales stock), and they may keep them many years.Current assets are assets that are expected to be used or turned into cash by the end of the reporting period. This includes sales stock (which is expected to be sold, at least in part, by the end of the reporting period), and bank (which the entity is likely to spend cash from within the reporting period). Capital assets are not current assets, as they are not expected to be turned into cash or used up within the reporting period.