How to calculate the current ratio cash ratio for financial statement analysis Calculation formula?

Various ratios for financial use

1, current ratio = total current assets / total current liabilities * 100%.

2. Quick ratio = quick assets/current liabilities. Quick assets is the balance of current assets after deducting inventories.

3. Cash Current Liability Ratio = Annual net cash flow from operations/Year-end current liabilities * 100%.

4. Gearing ratio = (total liabilities/total assets)*100%.

Expanded:

The level of the cash ratio is positively related to the size of the demand for money. Therefore, any factor that affects the demand for money can affect the cash ratio. For example, if the interest rate on bank deposits declines, resulting in a decrease in the return on interest-bearing assets, people will reduce their deposits in the bank and prefer to hold more cash, thus increasing the cash ratio.

The cash ratio is negatively correlated with the money multiplier, the higher the cash ratio, indicating that the cash out of the expansion process of deposit money and flow into the daily circulation of the amount of the more, thus directly reducing the amount of bank loanable funds, constraints on the deposit generating capacity, the smaller the money multiplier.

Baidu Encyclopedia - Cash Ratio