ACCOUNTING TERMS - ACCOUNTING DICTIONARY - ACCOUNTING GLOSSARY
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PERPETUAL SUCCESSION Definition
PERPETUAL SUCCESSION is one of the legal distinctions between a business and a company. A company has perpetual succession meaning that a change in the membership does not affect the existence of the company whereas a business does not enjoy this perpetual succession. For example, in the case of a partnership, which is one form of business registration, a change in the membership affects the partnership.
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TOTAL ASSET TURNOVER measures managements efficiency in managing all of a firm's assets - specifically the generation of revenues from the firms total investments in assets. This ratio is extremely important in high asset firms such as manufactures and telecommunications companies. Generally, the higher this ratio as compared to like companies or the industry (Formula: Net Revenue / Total Assets):
- the smaller the investment required to generate sales, thus the more profitable the firm.
- indicates the firm has less money tied up in fixed assets for each dollar of sales revenue.
ACR is Accounts Receivable. See ACCOUNTS RECEIVABLE.