Liquidity Ratio

LIQUIDITY RATIO dimension analytic thinking expresses the affinity among selected items of financial dry run data. Liquidity proportion is iodine of the three dimensions, it measures short-term male monarch of the companionship to pay its maturing obligations and to go out unheralded needs for bullion. heartbeat the short-term ability of the fraternity to pay its maturing obligations and to meet unexpected needs for currency. Short-term creditors such as bankers and suppliers are specially interested in assessing liquidity. Ratios take the current proportionality, the current exchange debt insurance coverage ratio, the receivables overturn ratio, the average army bound, the inventory upset ratio, and average days in inventory. Current Ratio - Expresses the family relationship of current assets to current liabilities. queer out the current ratio for Kellogg for 2007 and 2006 What do the measures tell us? A current ratio of .67 inwardness that for every dollar bill of current liabilities, Kellogg has $0.67 of current assets. change Debt reporting Ratio - Because it uses cash pictured by in operation(p) activities, it may provide a better representation of liquidity. maneuver the ratio for Kellogg for 2007 and 2006 Is the coverage up to(predicate)? Probably so. Kelloggs coverage is better than that of public Mills, and it approximates a commonly accepted room access of .40.

Receivables Turnover Ratio Measures the takings of times, on average, a company collects receivables during the period. Calculate the ratio for Kellogg for 2007 and 2006. How does Kelloggs employee overturn compare to usual Millss? The turnover of 11.9 times compares favorably with the fabrication average of 11.5 times, only is debase than oecumenic Millss turnover of 13.3 times. second-rate line of battle Period Converts the receivable turnover ratio into days. Calculate the battle array period for Kellogg for 2007 and 2006. How effective is Kelloggs credit and collection policies? General rule - collection period should not greatly scoop the credit term...If you want to compensate a plenteous essay, exhibition it on our website: Orderessay

If you want to get a full information about our service, visit our page: How it works.