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Re: Gixene post# 48256

Monday, 06/10/2013 9:42:01 AM

Monday, June 10, 2013 9:42:01 AM

Post# of 90887
JGulley317,

Assets= Liabilities+Equity

Book Value of asset= Cost of Asset- Accumulated Depreciation

Ratio of Fixed Assets to Long-term Liabilities=

Fixed Assets (net)
Long-term Liabilities

Ratio of Liabilities to Shareholder Equity=

Total Liabilities
Total Shareholder Equity

Don't confuse yourself by trying to classify an asset by long or short term, you are looking for fixed. It is important to understand the terminology or you will find yourself getting confused and frustrated! You need to determine current liabilities and long term liabilities. The formulas above should get you on the right track, if not, then you need to start at square one and look at a companies financial statements individually. Income Statement, Statement of Equity, Balance Sheet, and Statement of Cash Flows. Be sure to take note when looking at these 4 primary statements, the Balance Sheet is for a specific time whereas the other three are for a period of time. I hope this help somewhat.....
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