Fill out the blank line below; MUL What have you learned in about this lesson? the co Liquidity ratios are used to determine 1. Activity ratios are used to determine Leverage ratios are used to determine A Profitability ratios are used to determine
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1) Liquidity Ratios
Liquidity ratios are an important class of financial metrics used to determine a debtor's ability to pay off current debt obligations without raising external capital. Common liquidity ratios include the quick ratio, current ratio, and days sales outstanding.
2) Leverage Ratio
Leverage ratios are used to determine the relative level of debt load that a business has incurred. These ratios compare the total debt obligation to either the assets or equity of a business. ... Compares assets to debt, and is calculated as total debt divided by total assets.
3) Profitability Ratio
Profitability ratio is used to evaluate the company's ability to generate income as compared to its expenses and other cost associated with the generation of income during a particular period. This ratio represents the final result of the company.
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