What is the current asset management?
Current asset management is a manipulation of the company's current assets. Any assets that have a company or company that is equivalent to cash or can be liquidated in cash in the period of the year is considered a current asset. Current assets are usually an inventory that the company has, as well as receivables from accounts and any short -term investments that are introduced. The management of current assets also takes into account the long -term investment of the company, but short -term assets, another name for current assets, is important in determining the liquidity of the company. Indeed, the degree of liquidity is a measure of how well and how quickly the company can repay its debts.
The calculation of the current enjoyment is crucial when the correct balance to manage the current assets. The current ratio is the current asset divided by its current obligations. The URrent czaves are defined as what the company needs to pay in a certain cycle of time, whether in the financial year or in the time cycle that JE for the company, depending on what is longer.
If the company had current assets of $ 100,000 in the US (USD), but liabilities with $ 60,000 would equal the value of approximately $ 1.67, which means that the company has $ 1.67 USD for repayment for each dollar it owes. This is usually considered a decent ratio of current current, although what defines a good ratio will differ from industry to industry. Generally speaking, the ratio of $ 2 in current assets to each 1 USD responsibility is considered decent.
The financial planner or any person responsible for the current asset management works to maintain the balance of the current ratio, also known as the working capital ratio. Balanced ratio means that society is in good status-term, but it also means that society is more attractive to creditors and investors because the current ratio is considered to be a good way to determine FIscal competence of the company. If the value is too low, it means that the company is not a good credit risk because it cannot easily repay its debts. The current value of a ratio that is too high may mean that the company is not good in managing and investing its current assets.