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The cost of the main product, usually for the product with the highest physical or economical output, receives for example the equivalence number 1. On the basis of selected indicators (average market prices, physical properties, etc.) other equivalence numbers are formed, using suitable ratios between the different co-products.
Creative accounting may follow the letter of the rules of standard accounting practice, yet deviate by excessive complication creating opaqueness, whereas plugging the numbers deviates from accounting rules for a relatively "immaterial amount".
The current ratio is an indication of a firm's accounting liquidity. Acceptable current ratios vary across industries. [1] Generally, high current ratio are regarded as better than low current ratios, as an indication of whether a company can pay a creditor back. However, if a company's current ratio is too high, it may indicate that the ...
Sample current ratios. Let’s look at some examples of companies with high and low current ratios. You can find these numbers on a company’s balance sheet under total current assets and total ...
Math: the four-letter word you can say on TV yet so reviled that people go great lengths to avoid it, even when they know doing so puts their financial well-being in peril. Wait! Don't click away ...
For instance, to calculate an activity ratio like inventory turnover—a ratio that indicates how many times a company’s inventory is sold and replaced over a given timeframe—you would need to ...
A financial ratio or accounting ratio states the relative magnitude of two selected numerical values taken from an enterprise's financial statements. Often used in accounting , there are many standard ratios used to try to evaluate the overall financial condition of a corporation or other organization.
A ratio's values may be distorted as account balances change from the beginning to the end of an accounting period. Use average values for such accounts whenever possible. Financial ratios are no more objective than the accounting methods employed. Changes in accounting policies or choices can yield drastically different ratio values. [6]