Businesses often use profitability ratios to gauge their performance against industry benchmarks or competitors. Calculating these ratios involves a straightforward process, typically using figures ...

Understand what the current ratio measures, why it matters, and how to use it to assess and improve short-term liquidity.

When you want to get an idea of a company's financial condition, ratio analysis is one of the tools of the trade. In the following article, you'll learn about two useful balance sheet ratios: the debt ...

The inventory turnover ratio shows how efficiently a firm has used its inventory. This is important in a small business, where storing excess inventory can be an unwanted burden and cost. Calculate ...

In continuation of our series on “Accounting Basic for Startups”, this article will throw light on the calculation and interpretation of key financial ratios for evaluating the performance of a ...

The stock turnover ratio is another term for inventory turnover ratio. A stock turnover ratio measures the speed with which your inventory sells after you acquire it. Put another way, a stock turnover ...

Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor. Claire's expertise lies in corporate finance & accounting, mutual funds, ...

As such, it is seen as an indicator of how efficiently a company's management is deploying the economic resources it ...

One of the many variables lenders use when deciding whether or not to loan you money is your debt-to-income ratio or DTI. Your DTI reveals how much debt you owe compared to the income you earn. Higher ...