Liabilities: o Liabilities are considered as the financial obligations owed to other organizations or people. o Liabilities are also considered as the debts owed to non-owners or creditors. o It can be also considered as an alternative to equity as a source of organizations’ financing. o Liability decreases with an in the accounting records debit … Read more
Asset: The asset is a thing or resource owned by any person, organization, or country with the expectation that it will generate surplus/benefit in monetary value in the future. “Assets are future economic benefits, the rights of which are owned or controlled by an organization or individual”- Finney &Miller “Assets are valuable resources owned by … Read more
Return on Equity (ROE): • It is the ratio that shows the proportion of profit in comparison with the net assets it holds. • It is useful for the performance comparison of similar firms/companies in terms of money. • It is the ratio of Net Income by Common shareholder’s equity Figure 1: Formula of ROE … Read more
Financial Management: Financial Management is the process of arranging, designing, observing, and controlling financial resources in an organization. It is also considered as one of the most important factors in an organization for achieving the preset goals and objectives of any organization. Financial Management is the process of managing an organization’s fund as defined by … Read more