Incoming cash to the business less the outgoing cash during a given period. Also used to refer to the figure derived from net income plus noncash items charged off in the accrual accounting process. Assets pledged to secure a loan. Indicates how quickly your customers pay you. Average accounts receivable divided by net sales, multiplied by 365.
Owners have limited liability for the corporation's actions.
A corporation has unlimited life and in most cases is taxed as an entity on its own. Current assets divided by current liabilities. Average accounts payable divided by the cost of goods sold plus change in inventory, multiplied by 365. Average inventory divided by the cost of goods sold, multiplied by 365. Indicates the firm's debt level, or leverage.