Cash ratio defines the relationship of cash, cash equivalents and current liabilities. its formula is Cash + Cash Equivalents / Current Liabilities

# Category: Financial Ratio Analysis

Financial ratio analysis is the result of dividing one financial statement item by another is financial item. Ratios help financial analysts to interpret financial statements by focusing on specific relations.

## Quick Ratio Meaning Formula Example and Analysis

Quick ratio is in fact a strict calculation of an entity’s ability to settle its short-term liabilities. It also known as Acid Test Ratio. Its formula is Cash + Securities + Receivable / Current Liabilities

## Current Ratio Meaning Formula Example and Analysis

Current ratio measures the liquidity level of an entity. It indicates the ability of the entity to pay its current debts (current liabilities) out of its current assets. This is also called ‘the working capital ratio’. Short term creditors are Read More …

## Earnings Per Share Formula Examples and Analysis

Definition Earnings Per Share (EPS) which is also called ‘Net Income Per Share is an accounting ratio computed usually at the end of the financial year on the basis of profit earned. This ratio is market prospect and computes profitability levels Read More …

## Financial Ratio Analysis – Types of Ratios & Examples

Definition Financial ratio analysis is the result of dividing one financial statement item by another is financial item. Ratios help financial analysts to interpret financial statements by focusing on specific relations. In more simple words a ratio is nothing more Read More …