Abstract
The world of business has become an important criterion for survival these days. In the context of the realm of business, the liquidity ratio plays an imperative role in all possible ways. It has become the obligatory criteria in analyzing the liquidity ratio for a better understanding of the world of business nuances in general and the status of the company in particular. Analyzing the liquidity ratio guides in taking a bold and smart decision which will, in turn, seek the attention of prospective investors. It is highly essential for small-scale business developers to have a proper analysis of the liquidity ratio for better growth progress. This paper tries to investigate the needs of the liquidity ratio analysis from a business perspective.
Highlights
In a view of a business, liquidity refers to the ability of a company in raising the cash flow
The debt capacity and the ability in converting the assets to cash are the major determiners in tracing the liquidity of a company
Business liquidity is determined by the efficiency in converting the asset of a company into cash flow
Summary
In a view of a business, liquidity refers to the ability of a company in raising the cash flow. The debt capacity and the ability in converting the assets to cash are the major determiners in tracing the liquidity of a company. Cash flow is considered the most liquid of all assets. Business liquidity is determined by the efficiency in converting the asset of a company into cash flow
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