Accounting / August 3, 2018 / Willow Mccoy
If the stock does poorly, however, the investor won’t be able to convert the security to stock and will only have the yield to show for his or her investment. But unlike stock, convertible bonds can only fall so far – provide the issuing company remains solvent – since they have a specific maturity date at which time investors will receive their principal. In this sense, convertible bonds have more limited downside than common stocks.
The Days' Sales in Inventory ratio tells the business owner how many days, on average, it takes to sell inventory. The usual rule is that the lower the DSI is the better because it is better to have inventory sell quickly than to have it sit on your shelves.
A cash flow statement shows exactly how much money a company has received and how much it has spent, traditionally over a period of one month. It captures the current operating results and changes on the balance sheet, such as increases or decreases in accounts receivable or accounts payable, and does not include noncash accounting items such as depreciation and amortization.
In the context of corporate financial reporting, the income statement summarizes a company's revenues (sales) and expenses, quarterly and annually for its fiscal year. The final net figure, as well as various other numbers in the statement, are of major interest to the investment community.
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