ADJUSTMENTS started, without, becoming, please, assets

whew1110

Thought I'd give this a try....hope it catches on.

I think one of the ways to becoming comfortable with FSA is knowing when and how to make adjustments in calculating the ratios. So why not create a comprehensive list.

I've started it off with a few off the top of my head, please post your own additions! I think this can really help!

Adjusting for...

*Goodwill:

subtract goodwill from assets and exclude goodwill impairment from income

*Sale of receivables

if without recourse then increase cash and decrease A/R
if with recourse then increase A/R to original amount and increase short term debt
a sale would also overstate CFO, so you would decrease CFO and increase CFF

*Inventory

LIFO ==> FIFO via LIFO Reserve