Average Annual Current Maturities


DEFINITION of 'Average Annual Current Maturities'

The amount of principal paid on outstanding long-term debt during the upcoming year. Average annual current maturities is a financial figure listed in the notes to the financial statements. If this number is rising annually, it can be assumed that the company is taking on more debt.

BREAKING DOWN 'Average Annual Current Maturities'

Current maturities is the amount of time before a debt needs to be paid back. For example, if a loan was taken eight years ago and needed to be paid back in 10 years, the current maturity is two years.

When a company leverages itself through debt, it can be positive; however, too high a debt level could put a strain on cash resources as the company tries to make its interest payments. A prudent investor will monitor whether a company is taking on more debt and compare the debt levels with assets and revenues to see if the company is leveraging itself efficiently.

  1. Leverage Ratio

    Any ratio used to calculate the financial leverage of a company ...
  2. Degree Of Financial Leverage - ...

    A ratio that measures the sensitivity of a company’s earnings ...
  3. Interest

    1. The charge for the privilege of borrowing money, typically ...
  4. Degree Of Combined Leverage - DCL

    A leverage ratio that summarizes the combined effect the degree ...
  5. Degree Of Operating Leverage - ...

    A type of leverage ratio summarizing the effect a particular ...
  6. Leverage

    1. The use of various financial instruments or borrowed capital, ...
Related Articles
  1. Investing Basics

    Reading The Balance Sheet

    Learn about the components of the statement of financial position and how they relate to each other.
  2. Fundamental Analysis

    Analyzing A Bank's Financial Statements

    A careful review of a bank's financial statements can help you identify key factors in a potential investment.
  3. Investing

    Operating Leverage Captures Relationships

    Find out how fixed and variable costs interact to shed new light on old companies.
  4. Economics

    Calculating Days Working Capital

    A company’s days working capital ratio shows how many days it takes to convert working capital into revenue.
  5. Term

    What Is Financial Performance?

    Financial performance measures a firm’s ability to generate profits through the use of its assets.
  6. Economics

    Understanding Explicit Costs

    Common examples of explicit costs include wages, utilities, rent, raw materials, and other direct expenses companies pay to conduct business.
  7. Investing Basics

    What Does Off-Balance Sheet Mean?

    Assets or debts that a company excludes from its balance sheet are off-balance sheet items.
  8. Investing Basics

    Explaining Noncurrent Liabilities

    Noncurrent liabilities are financial obligations a company owes a year or more into the future.
  9. Investing Basics

    Calculating Net Cash

    A company’s net cash is its total cash remaining after it subtracts all liabilities.
  10. Investing Basics

    The Importance of Dividends in Your Portfolio

    Learn some of the primary reasons why dividends constitute a critical factor in the overall performance of a stock investor's portfolio.
  1. What are the risks of having both high operating leverage and high financial leverage?

    In finance, the term leverage arises often. Both investors and companies employ leverage to generate greater returns on their ... Read Full Answer >>
  2. How do dividends affect the balance sheet?

    Dividends paid in cash affect a company's balance sheet by decreasing the company's cash account on the asset side and decreasing ... Read Full Answer >>
  3. Who actually declares a dividend?

    It is a company's board of directors who actually declares a dividend. The declaration date is the first of four important ... Read Full Answer >>
  4. Are dividends considered an expense?

    Cash or stock dividends distributed to shareholders are not considered an expense on a company's income statement. Stock ... Read Full Answer >>
  5. Do dividends go on the balance sheet?

    The only account recorded on the balance sheet, when dividends are declared and before they are paid out to a company's shareholders, ... Read Full Answer >>
  6. What are some examples of general and administrative expenses?

    In accounting, general and administrative expenses represent the necessary costs to maintain a company's daily operations ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  2. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  3. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  4. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
  5. Cost Of Funds

    The interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!