Using a Balance Sheet to Your Best Advantage - First in a Series

When you are deciding whether to extend credit to a new customer or conducting a periodic review of an existing account, the company's balance sheet can be your "new best friend." The balance sheet contains information used to calculate widely-used credit analysis metrics: the quick and current assets ratios and the debt-to-equity ratio. You can analyze and compare these ratios with industry norms to gauge whether a new customer is credit-worthy or an existing account should be granted more or…