Financial Analysis YN 1

TanTan Company has received public construction project from government, it's sales situation can be shown in VAT input, output data.

Contract liabilities are listed in liabilities in balance sheet, so if the contract liabilities in 2023 increase significantly compared with 2022, it can be estimated that the revenue in 2024 will decrease significantly.

The amount obtained from the cash capital increase and the issuance of new shares shall be classified as cash inflow from financing activities.

Long-term borrowings due within one year are current liabilities.

The provision for bad debts will result in a reduction in working capital.

Financial liabilities are a stock concept, representing borrowings at a specific point in time. To assess a customer's borrowing status effectively, it is useful to analyze both the outstanding debt and the interest expense incurred over the year.

DSR (Debt Service Ratio) is mainly used to determine whether the company's cash inflow in the current year is enough to repay the principal and interest payable in the previous year. It is a more reliable financial indicator than the interest coverage ratio. The higher the DSR ratio, the greater the debt repayment pressure on the customer.

Quick assets are used to judge a company's immediate debt repayment ability, that is, how many dollars of quick assets can be used to repay each dollar of short-term debt. The larger this ratio, the better.

When company A cooperated with Financing Leasing Company Chaly, company A still needs to calculate depreciation for leased assets.

Company DongDong had a good net profit this year, but its cash flow from operating activities was negative. This may be because of company DongDong extend AP payment terms to supplier.