Key Liquidity and Solvency Ratios
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The third chapter examines the liquidity and solvency of a company. Although different in nature, these ratios are very much interrelated as they both address a company’s creditworthiness.
Short case studies and illustrations help the reader understand these concepts. Key takeaways on liquidity/solvency ratios and their limitations conclude the chapter.
KeywordsLiquidity Cash ratio Quick ratio Current ratio Solvency
References and Further Reading
- Anthony, Robert N., and James S. Reece. 1989. Accounting: Text and Cases. Irwin.Google Scholar
- Coulon, Yannick, January 2017, Guide pratique de la finance d’entreprise, Gualino.Google Scholar
- ———. September 2018, L’essentiel des ratios financiers, Maxima Laurent du Mesnil.Google Scholar
- Quiry, Pascal, and Yann Le Fur. 2019. Finance d’entreprise 2020 de Pierre Vernimmen. Dalloz.Google Scholar
- Stowe, John D., Thomas R. Robinson, Jerald E. Pinto, and Dennis W. McLeavey. August 2002. Analysis of Equity Investments: Valuation. AIMR and CFA Institute.Google Scholar
- Thibierge, Christophe. November 2013. Comprendre toute la finance, 2ème édition. Vuibert.Google Scholar
- Walsh, Ciaran. 2008. Key Management Ratios, 4th ed. Financial Times Series. FT Prentice Hall. Pearson Education Limited.Google Scholar