Key Financial Ratios

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Liquidity Ratios

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Profitability Ratios

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Operating Ratios

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Solvency Ratios

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Definitions

CURRENT RATIO

The current ratio is a measure of the solvency or liquidity of your business. It tells you whether your company has enough current assets to meet its short term financial commitments (i.e. current liabilities) as they become due. Typically you want a higher current ratio, as it means a better capacity to meet your short term financial obligations.

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