Balance_Sheet_Analysis

							                                                  Sample
                                          20XX BALANCE SHEET
                                             ($ in thousands)
                         Assets                                              Liabilities & Equity
Current Assets                                         Current Liabilities

 Cash                                          2,130 Accounts Payable

 Accounts Receivable                           3,770 Notes Payable

 Inventory                                     8,960

                   Total Current Assets       14,860                    Total Current Liabilities

Fixed Assets                                           Long-Term Liabilities

 Net Plant & Equipment                         7,230 Long-Term Debt
                                                       Owners' Equity
                                                        Common Stock & Paid-In Surplus
                                                       (Or all as Owner's Equity)
                                                        Retained Earnings

                                                                                     Total Equity

                         TOTAL ASSETS         22,090              TOTAL LIABILITIES & EQUITY

                 Short-Term Solvency                              Long-Term Solvency (Leverage)


                                                1.24


                                                0.49


                                                0.18


                                                0.13
                                                                                                =
                            This "sample" company has about $2.13 million dollars of cash-on-hand and
                            accounts receivables totally over $3.77 million.

s & Equity                  Business owners and CEO's should seek better, more efficient ways to preserve AND
                            free up CASH, while always seeking ways to generate new revenues.

                    9,150   HOW TO USE THIS ANALYSIS TOOL:
                            You can change any of the following metrics or assumptions to reflect your current
                    2,850   scenario:

                            Current Assets: Cash; Accounts Receivable; Net Plant & Equipment

                   12,000   Current Liabilities & Equity: Accounts Payable; Notes Payable;
                            Long-Term Debt; Common Stock & Paid-in Surplus; Retained Earnings

                            Seek the guidance of your accoutant to assist you in reflecting your current balance
                    2,350
                            sheet and examining the applicable ratios.

                    1,520   I'm always available to discuss how your various business strategies and best
                            practices may impact business performance and your long-term prospects for
                            growth. Write or call me at your convenience.
                    6,480   john@rcarrow.com 704-560-2207
                    8,000

                   22,350   In my opinion, the most important analysis ratios are what are considered the
                            "Capital Ratios", which measure the ratio of networking or equity capital to total
vency (Leverage)            assets, and the "Liquidity Ratios", measuring our ability to cover outstanding debt
                            service and/or payables to our vendors. Do you know what bank credit officers use
                            certain ratios to evaluate our creditworthiness to determine if they are willing to
                     0.65
                            lend us money? These are the "Short Term Solvency" ratios...and the most widely
                            used is known as the "acid-test ratio" or "quick ratio" .. calculated by short-term
                     1.79   assets divided by current liabilities. Another is the "current ratio" (current assets
                            divided by current liabilities). For long-term solvency, there are the "Leverage"
                            ratios such as the "debt coverage ratio" (working capital divided by long-term debt).
                     2.76
                            These financial ratios can be measured against ratios in prior years, or industry
                            averages, for quick, easy comparison. If you seek a new commercial loan or
                            refinancing, a key performance ratio is the "leverage ratio" or "long-term debt ratio"
                            (long-term debt as a percentage of owner/shareholder net worth).
                     0.23
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nk credit officers use
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 the "Leverage"
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