rules and who generates them . You will learn about the basic accounting equation and some necessary terms . The financial reports that you will find in the case are also explained . ( Transcript )
Now we move to the Interrelationships of Financial Statements tutorial to explore the Balance Sheet , Income Statement , and Statement of Cash Flows . These reports provide information about the financial position or health of the business , the success of business operations , and explains where the cash came in and where the cash went . Though this is a very basic look at the financial reports , it is a good starting place . To go beyond this tutorial , one could review the Annual Report of a business such as Wal-Mart available at the company ’ s web site and also download a copy of Wal-Mart ’ s 10k Report from the Securities & Exchange Commission as an exercise . The comparison of the two would provide an excellent view of the financial operation of the retail industry giant . ( Transcript )
Prior to starting our videos on ratio analysis there are a few terms that one needs to know : - Liquidity is the ability of the company to meet its current debt obligations . - Solvency is the ability of the business to remain in business over a long period of time in terms of its ability to pay its long-term debts . - Profitability is the company ’ s ability to generate a profit .
The Current Ratio tutorial includes the explanation of three ratios . The Current Ratio , Working Capital computation and the execution of the Quick Ratio are demonstrated . These are Liquidity ratios . ( Transcript )
Next , we will review the Inventory Turnover In this tutorial , Inventory Turnover Ratio and Accounts Receivable Turnover are demonstrated . These are Liquidity ratios . ( Transcript )
In the Debt Ratio tutorial , this Solvency ratio is demonstrated . ( Transcript )