SOLVENCY AND LIQUIDITY plz help! (1 Viewer)

[Tarahd]

HIIIIIII. Trying to get a business report done and am not sure for strategies for
1) increasing solvency
2) increasing liquidity?

which one looks at cash flow management ect and which one looks at improving working capital???
or do i have it completely wrong- i am sop ANNOYYYYEEEDD AT THIS GOD DAM REPORT. so tired. :mad1:

 

[Tarahd]

They are the definitons yes, but im not sure what the strategies are to increase (better)
a) liquidity and
b) solvency....

eg. is liquidity increased by bettering cash flows or increasing the working capital?

 

[Tarahd]

Thankyou very much for your assistance.
A great help =)

 

[du4luv]

They are the definitons yes, but im not sure what the strategies are to increase (better)
a) liquidity and
b) solvency....

eg. is liquidity increased by bettering cash flows or increasing the working capital?

Look it up in your business studies text book

As far as I know, liqudity is the business ability to pay it's short term debts and if this was to increase, the business than may exsprience high cash outflow.

Cash outflow refers to cash being distributed outside the business, example: the business will use cash outflow to pay its' creditors, institutions...etc

For solvency

What is the difference between insolvent and solvent?
Well insolvent can mean that the business has gone bankrupt, as an example or simply cannot pay its creditors due to poor cash inflow. When a business is solvent, it means that business has the ability to pay its debts. So by now you should have got the idea, aye