Discussion Post:There are three broad categories of financial ratios: liquidity, solvency, and profitability. Discuss what each category reveals about the company being analyzed.

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Liquidity ratios give a measure for the ability of the company of “satisfying the short-term obligations” [1]. Therefore, the ratios are relevant for a moment in time and not for average situations. The most common liquidity ratios are a) quick ratio, b) cash ratio, and c) defensive interval ratio.
Current ratio is calculated by dividing current assets by current liabilities (the latter is payable within one year). A greater ratio means a better position for the company in what regards the liquidity. Assets gather cash, account receivable, and inventories....

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