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5 Cards in this Set
- Front
- Back
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CURRENT RATIO
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Current Ratio =
Current Assets/ Current Liabs An increase in current ratio is a favorable trend & means the company is more liquid. |
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QUICK RATIO
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Quick Ratio =
(Current Assets-Inventory)/ Current Liabilities An increase in quick ratio is a favorable trend meaning company became more liquid. |
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CASH RATIO
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Cash Ratio = Cash/Current Liab
Increase in ratio = greater liquidity |
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TOTAL DEBT RATIO
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Total Debt Ratio =
Total Liab/Total Assets (Current Liab+LT Debt)/ T/A A decrease in debt ratio is a favorable trend. |
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DEBT EQUITY RATIO
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Debt Equity Ratio =
Debt/Equity Debt as a lower %age of equity is a positive trend... less leverage. |
