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Cash Ratio

What is the definition of Cash Ratio?

The ratio of a company's total cash and cash equivalents to its current liabilities. Also called the Liquidity Ratio or the Cash Asset Ratio, it indicates the extent to which the readily available funds can pay off the current liabilities.


Stockopedia explains Cash Ratio...

This ratio is more conservative than the quick ratio in excluding inventory and account receivable. It is less frequently used as a measure of liquidity because of this conservatism.