Exit Coach Bill Black interviews Top Advisors for Tips, Ideas & Precautions for Business Owners who want to grow and protect their company value and plan for a successful Business Sale or Transfer. Listen daily so you can be well-planned!
Episodes
Tuesday Feb 04, 2014
Tuesday Feb 04, 2014
Does your
intuition tell you that the firm may be a little cash strapped? Have your CFO give you a current Balance
Sheet and do a Quick Ratio.
A Quick
Ratio is taking your current cash (bank) balance(s) and add to it the total
Accounts Receivables. (Be sure to deduct all receivable over ninety days,
because these accounts are clearly a collection issue). Divide the Cash &
Accounts Receivable total by your Total
Current Liabilities! This is a good
indicator of liquidity, although by itself it is not a perfect one. The higher
the number the stronger the company.
Dave “G”