Ratio Analysis is broadly categorized into four main types; Liquidity Ratios, Activity Ratios, Profitability Ratios, & Leverage Ratios.

The current ratio of a company identifies the ability of a company to pay its short-term financial obligations.

Account receivable turnover indicates how many times you receive payment for your credit sales or convert it into cash in a given period.

Using cash flow analysis ratios, a company seeks out how much cash it has, where its cash is going, and what it needs to do to maintain!

Working Capital is the leftover amount after paying operating expenses whereas the Current Ratio determines the efficiency of current assets over current liabilities.