diff --git a/modules/m00042/index.cnxml b/modules/m00042/index.cnxml index f1d335a7..df624c9d 100644 --- a/modules/m00042/index.cnxml +++ b/modules/m00042/index.cnxml @@ -70,7 +70,7 @@ - cash ratio represents the firm’s cash and cash equivalents divided by current liabilities; often used by investors and lender to asses an organization’s liquidity + cash ratio represents the firm’s cash and cash equivalents divided by current liabilities; often used by investors and lender to assess an organization’s liquidity current ratio current assets divided by current liabilities; used to determine a company’s liquidity (ability to meet short-term obligations) liquidity ability to convert assets into cash in order to meet primarily short-term cash needs or emergencies quick ratio also known as the acid test ratio; ratio used to determine a firm’s ability to pay short-term debts using its most liquid assets