MASTERCLASS Investment – The Difference between Debt & Liability – Need to know what is used in a ratio

MASTERCLASS Investment – The Difference between Debt & Liability – So know what is used in a ratio

MASTERCLASS Investment – The Difference between Debt & Liability – So know what is used in a ratio

Often, investors use liability and debt when they mean the same thing. But there is a difference between Debt & Liability and one needs to know what is used in a ratio to understand it’s meaning. For example in the debt-to-equity ratio, debt means the total amount of liabilities. This means, debt includes short-term accounts such as overdrafts and credit cards and normally also includes accrued wages and utilities, income taxes due and other liabilities, plus long-term accounts and long-term loans and bonds payable. In other words, sometimes debt means all obligations… all amounts owed… all liabilities.
However, other times, the word
 debt is used more narrowly to mean only the formal, written financing contracts such as short-term loans payable, long-term loans payable and bonds payable, example – hire-purchase, equipment finance, etc. See more on Debt To Equity
As always, keep these in mind to know WHAT is being used – be clear and have it defined!

Want to learn the core issues of share investing? Our workshop Navigate to Successful Share Investinggives a 2.5 hour practical session to learn to easily understand Company Financial Statements, how to find healthy companies, what tools and ratios to use,work on examples, and also includes how to get better investment outcomes. Other Bonuses as well. Check the next one see Share WORKSHOP or call 0407 361 596


About SuperBenefitnews

Self-Managed Superannuation Service Providers in Australia. SuperBenefit will SET UP your SMSF and provide investment education for a better result. We take care of all your administration, accounting, ATO lodgement and audit of SMSFs, working with you and your advisors. If you want advice we can arrange one of our recommended advisors and accountants to meet with you, as we do not give advice, but take instruction only. Take control of your super, including property shares and other assets. Learn how to be your own advisor - make better decisions - by being mentored and coached to invest your own super wisely and strategically by qualified partners. Book to come to an event to find out more, or - Call us 0407 361 596, no obligation FREE strategy call.
This entry was posted in 2 Past Newsletter Topics, Investing - Stock Fundamentals, Masterclass Investment, SMSF Investing and tagged , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s