Rethinking Liquidity Ratios: The Case of Manufacturing in the Czech Republic
| Authors | |
|---|---|
| Year of publication | 2014 |
| Type | Article in Proceedings |
| Conference | The International Conference Hradec Economic Days 2014, Peer-Reviewed Conference Proceedings, Part V. |
| MU Faculty or unit | |
| Citation | |
| Field | Management and administrative |
| Keywords | financial performance; liquidity ratios; current ratio; optimal values; manufacturing |
| Description | Similar optimal or recommended values of liquidity ratios are commonly appearing in the Czech literature. The purpose of this paper is to calculate a recommended value of current ratio for large firms in the manufacturing sector based on the data in three consecutive years, from 2009 to 2011. The analysis of the best-performing firms showed that current ratio frequency distribution matches a gamma distribution function, where its peak determines the recommended value at 1.4 or as an interval (1.2, 1.6), which denotes the most common value of current ratio. |
| Related projects: |