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Wednesday, February 3, 2010

Days of Liquidity Ratio

Days of Liquidity Ratio

Formula to calculate days of liquidity:

Days of Liquidity = (quick assets x 365 days) / years cash expenses.



Days of liquidity definition and explanation:


The days of liquidity ratio indicates the number of days that highly liquid assets can support without further cash coming from cash sales or collection of receivables.
Posted by virtual learning at 2:32 PM

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