Liquidity Ratios Flashcards
1
Q
Net current asset ratio
A
Current assets / current liabilities
2
Q
Liquid capital ratio
A
Current assets - closing inventory / current liabilities
3
Q
Rate of inventory turnover
A
Cost of sales / average inventory
4
Q
Payable days
A
Payables / cost of sales X 365
5
Q
Receivable days
A
Receivables / credit sales X 365