Most important liquidity, profitability, and solvency ratios
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Select three ratios, one from each category—liquidity, profitability, and solvency—you think are the most important.
Why do you consider these ratios important? Which internal and external users might be most interested in these ratios?
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Solution Summary
Your discussion is 222 words and discusses the importance of the ratio a list of internal and external users.
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Liquidity
Current ratio: This is a critical measure to ensure that you have enough resources that are either cash or near to becoming cash to pay obligations that will be due in the coming months. A risky current ratio indicates a possible choke point for a business
Internal user: treasurer, controller, CFO
External user: banker, vendors, bond ...
Education
- BSc, University of Virginia
- MSc, University of Virginia
- PhD, Georgia State University
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