The asset turnover ratio is the percentage of a company’s revenue to the value of its average total short- and long-term assets. It measures how efficient a company is at using its assets to generate revenue. For example, if your net sales are $20,000 and average total assets are $12,000, then your asset turnover ratio…
What Is Net Working Capital: How to Calculator & NWC Formula
Net working capital (NWC) is the difference between a company’s current assets and current liabilities. A positive net working capital indicates a company has sufficient funds to meet its current financial obligations and invest in other activities. For example, if current assets are $85,000 and current liabilities are $40,000, the NWC is $45,000. Net Working…
What are Current Liabilities: How to Calculate & Formula
Current liabilities, also known as short-term liabilities, are the summation of a company’s debts, financial obligations, and accrued expenses that appear on its balance sheet and are due within twelve months. Examples of current liabilities include accounts payable, short-term loans, accrued expenses, taxes payable, unearned revenues, and current portions of long-term debt. Current Liabilities Formula…
Trailing Twelve Months (TTM) – What It Is & How To Calculate It
Trailing twelve months (TTM), also known as the “last twelve months (LTM),” represents the most recent 12-months of data used for financial reporting. It typically measures past revenue or profits and is an effective way to analyze financial data in an annualized format. This shouldn’t be confused with a calendar or fiscal year. For example, a…
SBA Form 159 – What It Is & How to Fill It Out
You’re required to submit SBA Form 159 if you or your lender hires a loan packager, referral agent, broker, accountant, attorney, or consultant to help prepare or secure your SBA loan. SBA Form 159 is less common than other SBA forms, only being filled out by less than half of all SBA loan applications every…
SBA Form 912 – What the Statement of Personal History Is & How To Fill It Out
SBA Form 912, the Statement of Personal History, is used to determine a borrower’s trustworthiness and evaluate whether applicant’s or their business partners have any criminal history. The information gathered by Form 912 helps the SBA determine if borrowers are of “good character.” Completing the form accurately and in detail will help prevent delays or…