Short-Term Liquidity Risk Ratios Flashcards
1
Q
Revenues to Cash Ratio
A
Revenues / Average Cash Balance
2
Q
Days Revenue in Cash
A
365 / Revenues to Cash Ratio
3
Q
Current Ratio
A
Current Assets / Current Liabilities
4
Q
Quick Ratio
A
(Cash + Marketable Sec. + Accounts Receivable) / Current Liabilities
5
Q
Operating Cash Flow to Current Liabilities Ratio
A
Cash Flow from Operations / Average Current Liabilities
6
Q
Days Accounts Receivable
A
365 / Accounts Receivable Turnover
7
Q
Days Inventory
A
365 / Inventory Turnover
8
Q
Days Accounts Payable
A
365 / Accounts Payable Turnover
9
Q
Net Days Working Capital
A
(Average Working Capital x 365) / Annual Sales Revenue
Working capital is Current Assets - Current Liabilities
