Firm Liquidity Ratios
How to do managers and investors determine a company's liquidity? Using this tool you will learn about four financial ratios commonly used to determine liquidity: (1) the cash conversion cycle; (2) cash ratio; (3) current ratio; and (4) quick ratio (acid-test). While comparing ratios between companies from different industry sectors, consider how different factors influence the analysis. Use the graphs to consider ratios in the context of relevant industry sectors.
Select the Slide Deck for a guided assignment on this topic. Then use the Link to Platform to try the exercise yourself. Your instructor may have additional guidance regarding the use of this Teaching Tool.