There are dozens of financial ratios and their meanings help business owners evaluate the financial health of a company. Financial ratios can be broken into six key areas of analysis: liquidity, ...

The debt-to-equity (D/E) ratio is a financial metric that measures a company's financial leverage by comparing its total debt to shareholders' equity. It indicates how much debt a company uses to ...

Managing a business without a clear handle on your financial data is like flying blind. You may be moving quickly, but you can’t see if you're on course or heading for turbulence. Over the years, in ...

For investors and business management alike, a few critical financial ratios help assess a company's financial health. One of the common ways of using these ratios is to compare them, ratio by ratio, ...

A balance sheet is one of two standardized financial reports produced on a regular basis. It provides information used by professionals in the financial community to analyze company performance and ...

Discover how the working ratio reveals a company's ability to cover operating costs from revenue, learn the calculation method, and understand its limitations.

Equity-to-asset ratio indicates how much of a company is owned versus debt-leveraged. To calculate, divide total equity by total assets; e.g., $4M/$5M = 80%. Compare ratio to industry to assess ...

A quick ratio is a metric used to calculate a company's liquidity and how easily it could pay off its debts. A quick ratio works by providing a relatively fast assessment of a company's financial ...

Opinions expressed by Entrepreneur contributors are their own. Being an entrepreneur for more than 30 years has taught me how important it is to track data about my business. But, I didn’t always take ...

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle. Andy Smith is a Certified Financial ...

The Treynor ratio is a tool in portfolio analysis that helps investors assess how well a portfolio compensates them for taking on market risk, also known as systematic risk. This portfolio ratio shows ...

Liquidity ratios assess if a company can cover short-term debts with available assets. Key ratios include cash, quick, current, and operating cash flow ratios. A liquidity ratio over 1 suggests a ...