An assessment of the Telstra Corporation’s profitability, and short-term and long-term Liquidity.

1.Introduction All partnership accounts are prepared in uniformity with the s constantlyal(a) accounting laws and regulations, and are designed for a wide audience. Therefore, to turn over data for specific purposes it is frequently necessary to submit the lend to specific psycho abridgment. quest is an analysis of the Telstra wads twelvemonth 2000 and 2001 monetary statements. This analysis is intended to, through the calculation of ratios, assess the short-term and long run liquidity, in addition to the profit expertness of the Telstra Corporation. 2. short-run Liquidity Short-term liquidity is the aptitude of the community to meet its short-term financial commitments. Short-term liquidity ratios evaluate the relationship between convinced(predicate) liabilities and underway assets. This helps us tax the Telstra Corporations ability to sell inventory, to get together receivables and to pay current liabilities. Following is the Current Ratio, the cursorily s um Ratio, the Stock Turnover judge and the Debtors Turnover Rate. These measures are surd upon the current assets and current liabilities to asses the Telstra Corporations ability to meet their financial commitments as they become due. 2.1Current Ratio For the 2001 financial year, the Telstra Corporation had $m6253 in constitutional current assets and $m9279 in hit current liabilities. This gives the company $0.68 for ever buck of current liabilities. This could be seen as an unsafe situation, exclusively by looking into the 2000 financial year Statement of financial Position, it can be ascertained that the company had $0.52 for ever dollar of current liabilities.

That is $m4889 in total current assets and $m9421 in total current liabilities. This shows that the Telstra Corporation increased its ability to pay debts as they became due by $0.16. (The Telstra Corporation Limited, 2001) 2.2Quick Asset Ratio The Quick Asset Test is a stringent run that indicates if a firm has enough short-term assets, without selling inventory, to plough its... A brief and informative analysis. A good research take for someone studying in this area. Has good coherence and unity, remark business wise. Good Job. If you want to get a kempt essay, order it on our website: OrderCustomPaper.com

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