Front
Current Ratio
Back
Current Assets / Current Liabilities
Measures short-term debt-paying ability; a value >1.0 is generally considered healthy.
Public Deck
Financial Ratios - 35 Essential Metrics
Master financial analysis with 35 flashcards covering liquidity, profitability, leverage, and efficiency ratios.
AnyFlashcards35 cards
Preview
Front
Quick Ratio (Acid-Test)
Back
(Current Assets - Inventory) / Current Liabilities
Measures immediate liquidity; >1.0 suggests strong ability to cover debts without selling stock.
Front
Cash Ratio
Back
Cash & Equivalents / Current Liabilities
The most conservative liquidity measure; higher is safer but may imply inefficient use of cash.
Front
Net Working Capital
Back
Current Assets - Current Liabilities
Absolute measure of short-term liquidity; positive values are necessary for daily operations.
Front
Defensive Interval Ratio
Back
Current Assets / Daily Operating Expenses
The number of days a firm can operate using only liquid assets; higher indicates more safety.
Front
Operating Cash Flow Ratio
Back
Operating Cash Flow / Current Liabilities
Ability to pay debts from generated cash; >1.0 indicates strong cash generation relative to debt.
Front
Working Capital Ratio
Back
Current Assets / Current Liabilities
Indicates if a firm can meet short-term obligations; identical to the Current Ratio.
Front
Absolute Liquidity Ratio
Back
(Cash + Marketable Securities) / Current Liabilities
Focuses only on the most liquid assets; higher indicates better immediate solvency.
Front
Gross Profit Margin
Back
(Revenue - COGS) / Revenue
Efficiency of production and pricing; higher indicates better cost control over direct production.
Front
Operating Profit Margin
Back
Operating Income / Revenue
Profitability from core operations; higher suggests better operational efficiency and overhead control.
+ 25 more cards
Related Flashcard Decks
Ready to study?
Sign up for free to copy this deck and start learning with spaced repetition.
Get started for free