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Personal finance is the financial management that an individual or a family ... A personal balance sheet lists the values of personal assets (e.g., car, house ...
Current assets allow companies and investors to assess if a firm can pay off its financial obligations. Companies that cannot keep up with short-term liabilities may stagnate, lose market share or ...
In financial economics, a distinction is made between capital and other assets. Capital refers to any asset used to make money as opposed to other assets used purely for personal enjoyment or consumption. The goal of the distinction is to ensure personal taste does not play a role in valuation of capital.
Finance refers to monetary resources and to the study and discipline of money, currency, assets and liabilities. [a] As a subject of study, it is related to but distinct from economics, which is the study of the production, distribution, and consumption of goods and services.
Current ratio is generally used to estimate company's liquidity by "deriving the proportion of current assets available to cover current liabilities". The main idea behind this concept is to decide whether current assets which also include cash and cash equivalents are available pay off its short term liabilities (taxes, notes payable, etc.)
An asset's initial book value is its actual cash value or its acquisition cost. Cash assets are recorded or "booked" at actual cash value. Assets such as buildings, land and equipment are valued based on their acquisition cost, which includes the actual cash cost of the asset plus certain costs tied to the purchase of the asset, such as broker fees.
Net worth is the value of all the non-financial and financial assets owned by an individual or institution minus the value of all its outstanding liabilities. [1] Financial assets minus outstanding liabilities equal net financial assets, so net worth can be expressed as the sum of non-financial assets and net financial assets.
Other assets’ values fluctuate with supply and demand, such as commodities, which are liquid investments unlike most other tangible investments. These various properties, together with the lack of correlation to traditional asset class values, make tangible investments a means of reducing overall investment risk through diversification .