Cash flow ratio analysis

What this note covers

1. The role of cash flow ratios in financial analysis
2. Cash flow to sales ratio: formula, calculation, and interpretation
3. Cash flow to total liabilities ratio: formula, calculation, and interpretation
4. Comparing results to prior periods and industry benchmarks
5. Assessing liquidity using cash flow ratios
6. Assessing debt-servicing capacity using the cash flow to total liabilities ratio
7. Limitations of cash flow ratios and integrated analysis

7 sections · 12 key terms & formulas · 6 common mistakes