Analyzing Balance Sheets Flashcards
Identifiable Intangible asset
Patents, trademarks, copyrights
Unidentifiable intangible asset
May have indefinite life, e.g goodwill
Typical intangibles on the balance sheet
Purchased patents and copyrights
Brands, trademarks
Direct response advertising
Purch. franchise and license cost
Goodwill
Comp. software dev.costs
Typically expensed items
aka not intangible assets
Internally generated brands
start-up costs
training costs
admin and general overhead
adverts and promo
relocating and reorg costs
redundancy and termination costs
r&D - may be cap under IFRS
Goodwill
Unidentifiable itangible assetThe difference between the acquisition price and the fair market valuue of the acquired firm’s net assets
Financial instruments
= marketable securities
Long-term financial liabilities
Bank loans, notes payable, bonds payable, and some derivatives
Usually ewported on BS at amortized cost
current ratio
current assets / current liabilities
liquidity ratio
quick ratio
(cash + marketable securities + receivables) / current liabilities
liquidity ratio
cash ratio
(cash + marketable securities) / current liabilitiws
liquidity ratio
long-term debt to equity ratio
total long-term debt / total equity
solvency ratio
debt to equity ratio
total debt / total equity
financial leverage ratio
total assets / total equity
total debt ratio
total debt / total assets
