Liquidity refers to a companys cash position availability, Ask an Expert

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Liquidity refers to a company's cash position, availability of resources to meet short-term cash requirements, and overall ability to obtain cash in the normal course of business. A company is said to be liquid if it has sufficient cash or is capable of converting its other assets to cash in a relatively short period of time so that presently maturing debts can be paid.

Required:

1. Measure the current, quick, and cash flow liquidity ratios, along with the working capital ratio for your company for the last 3 years.

2. What information does your calculation give an investor or creditor? What are the ratio trends?

3. Repeat requirement 1-2 for your competitor and compare the ratios.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9530105

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