3 Liquidity Ratios You Should Know

👉 Confused by accounting? Download this free cheat sheet: https://accountingstuff.com Liquidity Ratios help you assess if a business can meet its short-term obligations. In this video, I'll introduce you to three well-known Liquidity Ratios: ▪ Current Ratio: Also known as the Working Capital Ratio. This is the least conservative Liquidity Ratio. It's calculated by dividing Current Assets by Current Liabilities. ▪ Quick Ratio: Also known as the Acid-Test Ratio, it only considers Liquid Assets. ▪ Cash Ratio: This is the most conservative Liquidity Ratio. We can calculate the Cash Ratio by dividing Cash and Cash Equivalents by Current Liabilities. 🔴Subscribe for more Accounting Tutorials → https://geni.us/subtothechannel ⏱️TIMESTAMPS 00:00 - Intro 00:34 - 1. Current Ratio 03:05 - 2. Quick Ratio 04:18 - 3. Cash Ratio 🔎FAQ ▪ My Favourite Accounting Book for Beginners → http://geni.us/5mKR7m 🎬LEARN ACCOUNTING BASICS FOR FREE ▪ The Full Playlist →    • ACCOUNTING BASICS for Beginners (Whole Pla...   🔝 CLOUD ACCOUNTING SOFTWARE ▪ XERO (Free Trial / Discount) → https://xero5440.partnerlinks.io/08mf... ▪ QuickBooks Online USA (Free Trial / Discount) → https://geni.us/quickbooksonlineusa ▪ QuickBooks Online Canada (Free Trial / Discount) → https://geni.us/quickbooksonlinecanada 🚶FOLLOW ME ON ▪ Instagram →   / accountingstuff   ▪ TikTok →   / accounting_stuff   ▪ Facebook →   / thisisaccountingstuff   ________________________ DISCLAIMER Some of the links above are affiliate links, where I earn a small commission if you click on the link and purchase an item. You are not obligated to do so, but it does help fund these videos in hopes of bringing value to you! ________________________ #accounting #accountingbasics #accountingstuff