02 October 2013
liquidity ratios tell the solvency position of company in short term and long term. i.e. whether the company will be able to meet its liabilites or not?liquidity ratios are very useful for banks, creditors/business partners as a company's credit worthiness can be judged with this ratio. Short term liquidity ratio.Example-current ratio,quick ratio Long term liquidity ratio.Examples-debt equity, proprietory ratio,capital gearing ratio
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