What Does Current Ratio Mean?

What Does Current balance Mean? A liquidity ratio that measures a companys capacity to pay short-term obligations. The Current ratio formula is: What Does Quick Ratio Mean? An indicator of a companys short-term liquidity. The quick ratio measures a companys ability to meet its short-term obligations with its most liquid assets. The higher(prenominal) the quick ratio, the bankrupt the position of the company. The quick ratio is calculated as: What Does Receivables turn over Ratio Mean? An accounting measure use to measure out a firms effectiveness in extending credit as tumesce as collecting debts. The receivables turnover ratio is an activity ratio,  fourth dimension how efficiently a firm uses its assets. Formula: summation unbalance What Does plus Turnover Mean? The tally of sales generated for every dollars expenditure of assets. It is calculated by dividing sales in dollars by assets in dollars. Formula:   Also known as t he Asset Turnover Ratio. The debt ratio compares a companys total debt to its total assets, which is used to adopt a general idea as to the amount of leverage being used by a company. A disordered percentage means that the company is less drug-addicted on leverage, i.e., money borrowed from and/or owed to others. The lower the percentage, the less leverage a company is using and the stronger its equity position.

In general, the higher the ratio, the to a greater extent risk that company is considered to swallow taken on. Formula:  | Components: | What Does Fixed-Charge reportage Ratio Mean? A ratio that indicates a firms ability to satisfy fixed funding expenses, such as hobby and leases. It is calculated! as the hobby: Investopedia explains Fixed-Charge Coverage Ratio For example, since leases are a fixed charge, the reckoning determining a companys ability leases would be (EBIT + Lease Expenses) / (Lease Expenses + Interest). rank Profit Margin Although we are only a fewer lines into the income statement, we can already calculate...If you want to get a large essay, order it on our website: OrderEssay.net

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