Liquidity Indicators Flashcards

1
Q

Liquid capital (quick) ratio

A

Current assets - inventory

Current liabilities

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2
Q

Accounts receivable collection period

A

Trade receivables X 365

Sales revenues

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3
Q

Accounts payable payment period

A

Trade payables X 365

Cost of sales

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4
Q

Inventory holding period

A

Inventory X 365

Cost of sales

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5
Q

Current ratio

A

Current assets

Current liabilities

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