CURRENT AND LONG-TERM ASSETS

Current and Long-Term Assets

Current and Long-Term Assets

Introduction

The company I am going to use for giving the questions related to financial analysis is “Wal-Mart”. Wal-Mart is performing well overall and remains a leader within the retail industry; the company is not without opportunities for improvement. It has grown dramatically in the recent years. But the debt of the company is also increasing. The Wal-Mart segment accounted for 68% of company sales (a 10% increase over the previous year)

Current and long-term assets on the company's balance sheet

According to the company three year report debt has increased due to the expansion efforts, while sales have steadily increased at a rate of only 11%. Total current liabilities have increased by 38% and long term debt has increased by 8%. Total current assets increased by 25% and total assets increased by 24%. This shows that although the company has increased its current assets, it has increased its current liabilities at a higher rate. (Fromlet, H. 2001)

Can Current asset take into account as a long-term asset?

Yes we can say that long-term asset, if it is used to buy out government bonds and make the liquidity of the current asset in a fixed term deposit.

Major issues in valuation of current and long-term assets

In determining the asset allocation of its fundamental properties is essential in terms of choice of the method (option) valuation of assets. You have options valuation of assets: -Cost, which is the sum of acquisition costs; -Realizable value - the amount of money that can be; derived from their sale are currently under normal conditions; (Fama, E. 1965)

The reduced cost - present value of future net inflows cash, which will produce an asset under normal conditions functioning of the enterprise;

-Market value - the amount of money that can be obtained the sale ...