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VCE Accounting Units 3&4 > Unit 4 Acc Chapter 19 Liquidity Glossary/Equations > Flashcards

Unit 4 Acc Chapter 19 Liquidity Glossary/Equations Flashcards

1
Q

Level of liquidity

Working Capital Ratio

A

Current Assets/Current Liabilities

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2
Q

Level of liquidity

Quick Asset Ratio

A

CA (exclude stock &prepaid expenses)/CL (exclude bank overdraft)

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3
Q

Level of liquidity

Cash Flow Cover

A

Net cash flows - operations/ Average Current liabilities

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4
Q

Speed of liquidity

Stock Turnover

A

Average stock/cost of goods sold x365

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5
Q

Speed of liquidity

Debtor’s turnover

A

Average debtors/credit sales x365

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6
Q

Speed of liquidity

Creditor’s Turnover

A

Average creditors/credit purchases x365

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7
Q

Liquidity

A

ability of business to meet it’s short term debts as they fall due

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VCE Accounting Units 3&4 (41 decks)

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