Liquidity Flashcards
1
Q
Current ratio
A
Indicates the ability to repay current liabilities out of current assets
2
Q
Acid-test ratio
A
ability to repay current liabilities without inventory
3
Q
Working capital ratio
A
How much of total assets are relatively liquid
4
Q
Debtors collection period
A
Idea of average period it takes between date of sale and final receipt of cash
5
Q
Debtors turnover
A
Credit collection efficiency
6
Q
Debtors components
A
Collection period and turnover
7
Q
Inventory
A
Days on hand and turnover
8
Q
Creditors
A
Repayment period, turnover and business cycle
