Answer / kanchan kumar das

Liquidity ratio we mean that how much fund is available
from current assets excluding stock to mitigate the current
liabilities within next 12 months. This is simply the ratio
of current assets and current liabilities which shows how
much strong the company is to pay-off the current
liabulities. It is also known as current account ratio.
So the formula:
Current Assets
Liquidity Ratio = ----------------------
Current Liabilities

Answer / umesh raut

LIQUIDITY RATIO MEANS THE RATIO THROUGH WHICH WE CAN FIND
THE OVERALL POSITION OF THE CURRENT ASSETS OVER CURRENT
LIABILITIES.IT SHOWS THAT HOW MUCH CURRENT ASSET IS THERE
FOR RECOVERING THE CURRENT LIABILITIES. WE CAN CONCLUDE THE
SIMPLE RATIO OF LIQUIDITY AS FOLLOWS--


LIQUIDITY RATIO= LIQUID ASSETS/ LIQUID LIABILITIES

LIQUID ASSETS = CURRENT ASSETS-(STOCKS+PREPAID EXPENSES).
LIQUID LIBILITIES =CURRENT LIBILITIES-(BANK OVER DRAFT
+S.T.LOAN+CASH CREDIT).

Answer / peter athanas

liquidity ratio measures the ability of the company to meet
short term obligations(current liability)by using its
current assets.
quick ratio and current ratio are the major components
which can be used to calculate the liquidity ratios.

Answer / sumithra.pj

aliquidity ratio measures a companys ability to pass its
bills .the denominator of a liquidity ratio is the companys
current liabilities
most common liquuidity ratio is the current ratio

Answer / shruti

liquidity ratio mean to find out the company ability to pay short term obligation.It is the ratio between current assets by current liabilities.which to check the financial position of company in relation to current assets,the abilities to pay short term liabilities.the sound ratio should in 2:1.which means company financial liquidity position is sound.

Answer / sathish

Liquidity mean ability to clear the current liabilities.
The arthematical expression between the current liabilities
and current assets is called liquidity ratio.
the ideal ration is 2:1

Liquid ratio = Liquid assets /liquid liabilities

Answer / ch.satish bhargav

The liquidity ratio shows the current financial position of
the company by calculating the difference between the
current assets and current liabilities.

The formula is :

Current assets
Liquidity Ratio= ---------------------
Current liabilities

Answer / challa bhagi

2:1

Answer / mehraj wani

by the term Liquidity we mean " to meet current
obligations", since the currenet obligations can only be
met with the ready cash or near cash instruments like guilt-
edged securities.

Liquidity Ratio can be defined as:
Current Assets - Inventories / Current Liabilities

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