Financial obligations to creditors that a company expects to pay after more than one
year. They appear in the liabilities section of the balance sheet.
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long-term liabilities
A capital structure ratio that measures the ability of a firm to pay its interest expense.
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times interest earned ratio
The basic form of an account.
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T-account
A cost that a business has already incurred and cannot recover, and therefore, the
firm should not consider it when making an investment decision.
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sunk cost
A company's ability to generate sales from the assets it has acquired.
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asset management efficiency
Physical assets with relatively long useful lives currently used in operating the
business. For example, buildings, factories, automobiles, etcetera, all of which are
reported in the assets section of the balance sheet.
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property, plant, and equipment (PPE)
The capacity to make a profit: the income earned after deducting all costs and
expenses related to generating revenue.
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profitability
The mixture of debt and equity a firm uses to finance its assets.
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capital structure
An asset management efficiency ratio that measures how effectively a company is
using its fixed assets to generate revenue.
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fixed asset turnover ratio
The constraint of determining whether the costs incurred to provide the financial
information outweigh the benefit that financial statement users will gain from having
year. They appear in the liabilities section of the balance sheet.
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long-term liabilities
A capital structure ratio that measures the ability of a firm to pay its interest expense.
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times interest earned ratio
The basic form of an account.
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T-account
A cost that a business has already incurred and cannot recover, and therefore, the
firm should not consider it when making an investment decision.
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sunk cost
A company's ability to generate sales from the assets it has acquired.
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asset management efficiency
Physical assets with relatively long useful lives currently used in operating the
business. For example, buildings, factories, automobiles, etcetera, all of which are
reported in the assets section of the balance sheet.
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property, plant, and equipment (PPE)
The capacity to make a profit: the income earned after deducting all costs and
expenses related to generating revenue.
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profitability
The mixture of debt and equity a firm uses to finance its assets.
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capital structure
An asset management efficiency ratio that measures how effectively a company is
using its fixed assets to generate revenue.
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fixed asset turnover ratio
The constraint of determining whether the costs incurred to provide the financial
information outweigh the benefit that financial statement users will gain from having
