A. Liquidity Ratios
B. Profitability Ratios
C. Leverage Ratios
D. Turnover Ratios
E. Coverage Ratios
F. Market Ratios
G. Control Ratios
Common Questions (Q&A)
Q: What’s the difference between the current ratio and the quick ratio?
A: The current ratio includes all current assets, while the quick ratio excludes inventory and prepaid expenses, focusing on more liquid assets.
Q: Why is the debt-to-equity ratio important?
A: It shows how much of a company’s financing comes from debt versus equity. A higher ratio means more reliance on debt, which could increase financial risk.
