Liquidity ratios

From CNM Wiki
Revision as of 10:53, 27 November 2023 by Gary (talk | contribs) (Gary moved page Liquidity ratio to Liquidity ratios over redirect)
Jump to: navigation, search

Liquidity ratio is the two ratios—current ratio and acid test ratio—which measure a company’s ability to pay off short-term debts.


Definitions

According to College Accounting: A Practical Approach by Slater (13th edition)‎,

Liquidity ratios. The two ratios—current ratio and acid test ratio—which measure a company’s ability to pay off short-term debts.

According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),

Liquidity ratios. Ratios that show the relationship of a firm's cash and other current assets to its current liabilities.

According to the Strategic Management by David and David (15th edition),

Liquidity ratios. The current ratio and quick ratio measure a firm's ability to meet short-term cash obligations.


Related concepts

Related lectures