ACTG 2010 Lecture Notes - Lecture 6: Cash Cash, Cash Management, Quick Ratio
Document Summary
Cash: anything that can be immediately converted to cash: treasury bills, guaranteed investment certificates. Ifrs allows you to adjust if your country has high levels of inflation. Dependent on how much you can buy. Do not just let money sit there, use it to get income and invest. Making sure you do not run out of cash or have too much lying around. Segregation of duties: the person receives the cash is not allowed to account for it. Annuity: series of equal cash flows made at equally spaced time periods. Dr. bad debt (expense, money you will not get back) Someone calls in and cannot pay, you want to close the account. Direct write off method: dr. bad debt, cr. Ar: no allowance account, not allowed in ifrs, match revenues and expenses by year. Allowance method: estimates must be made, based on what you think historically will go wrong, methods. Percentage of credit sales (cid:1843)(cid:1873)(cid:1855)(cid:1863) (cid:1870)(cid:1853)(cid:1872)(cid:1867) =(cid:1869)(cid:1873)(cid:1855)(cid:1863) (cid:1853)(cid:1871)(cid:1871)(cid:1857)(cid:1872)(cid:1871) (cid:1864)(cid:1854)(cid:1853)(cid:1864)(cid:1872)(cid:1857)(cid:1871)
