How can you tell by ratios if a company has negative working capital?
Answer
A current ratio of less than 1
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#balance-sheet-analysis
Question
How can you tell by ratios if a company has negative working capital?
Answer
?
Tags
#balance-sheet-analysis
Question
How can you tell by ratios if a company has negative working capital?
Answer
A current ratio of less than 1
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Subject 5. Uses and Analysis of the Balance Sheet the following ratios takes a slightly different view of cash or near-cash items.
Current Ratio is a measure of the number of dollars of current assets available to meet current obligations. It is the best-known liquidity measure. <span>A current ratio of less than 1 indicates the company has negative working capital.
Quick Ratio (Acid-Test Ratio) eliminates less liquid assets, such as inventory and pre-paid expenses, from the current ratio. If inve
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