Financial ratios are a way to evaluate the performance of your business and identify potential problems. Each ratio informs you about factors such as the earning power, solvency, efficiency and debt load of your business.
Leverage ratios provide an indication of your company’s long‑term solvency and to what extent you are using long-term debt to support your business.
Liquidity ratios measure the amount of liquidity (cash and easily converted assets) that you have to cover your debts and provide a broad overview of your financial health.
(also called cash ratio or acid test ratio)
Indicates a company’s ability to meet immediate creditor demands, using its most liquid assets (cash or assets that are easily converted into cash), also called quick assets.Learn more
Profitability ratios are used not only to evaluate the financial viability of your business, but also to compare your business to others in your industry.
(also called return on sales)
Measures the percentage of sales revenue retained by the company after operating expenses, interest and taxes have been paid.Learn more
(also called return on total assets)
Measures how much profit is generated compared to how much a company has invested to generate those profits.Learn more
Financial calculator tools
Set your business on the right path by identifying the best practices in your industry and then comparing them to your own.