Question

describe some of the accounting requirements for recognizing/accounting for it: Payroll Then describe how working capital, current ratio and quick ratio can be useful in making economic decisions. Who would be making these decisions?

Answer 1

Accounting involves recording,presentation or summarising the transaction. Therefore the payroll data is important to understand the expense that company is incurring on human resource moreover to comply with the social security reqirement it is mandatory.

Working capital, current ratio, quick ratio are useful to understand position of current assets like cash, balance at bank etc. All money related deicision revolve around the economic decision therefore these ratio are imporatnt from that perspective.

These decision are generally taken by the management in charge or a consultant can be hired to provide analysis or input on such ratios.