Business

Essay specific features

 

Issue:

Business

 

Written by:

Joyce W

 

Date added:

March 1, 2017

 

Level:

University

 

Grade:

A

 

No of pages / words:

18 / 4779

 

Was viewed:

4696 times

 

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Essay content:

A business may be cash flow insolvent but balance sheet solvent if it holds illiquid assets, particularly against short term debt. Conversely, a business can have negative net assets showing on their balance sheet but still be cash flow solvent if ongoing revenue is able to meet debt obligations, and thus avoid default – for instance, if it holds long term debt...
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Insolvency is not a synonym for bankruptcy, which is a determination of insolvency made by a court of law with resulting legal orders intended to resolve the insolvency. According to Section 123 of UK Insolvency Act 1986, insolvency is defined both in terms of cash flow and in terms of balance sheet in the: 1) A company is deemed unable to pay its debts; (e) if it is proved to the satisfaction of the court that the company is unable to pay its debts as they fall due...
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