This week, I'm focusing on another ratio to help gauge a company's financial health: the Current Ratio. It's calculated by dividing current assets by current liabilities. The higher the ratio, the ...

Current ratio is a measure of liquidity, which compares a company's current assets with its current liabilities. Current ratio is a favored test among banks and lenders because it reveals whether a ...

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When a business offers credit to a favorite customer, loyalty and the desire to make the sale often play roles in the move. But one thing the financial crisis taught American businesses is that it’s ...

Unlike the cash conversion cycle (CCC), which is a function of three days ratios, the current ratio is simply the total current assets (TCA) over the total current liabilities (TCL). However, the ...

Liquidity ratios are key financial ratios used by internal and external analysts to gauge a company's liquidity, which represents its capacity to pay its existing short-term liabilities if it needs to ...

A quick ratio below industry standard means that your company has a relatively lower liquidity position than its competitors on one of the three common liquidity ratios used by companies. The quick ...

What is a good current ratio? A good current ratio should be higher than one. This would indicate that the company can cover its liabilities with its assets. If the current ratio is lower than one, it ...