Which ratios would a banker be most interested, Financial Management

Assignment Help:

Which ratios would a banker be most interested in when considering whether to approve an application for a short-term business loan? Explain.

Bankers and other lenders use liquidity ratios to see whether to expand short-term credit to a firm.  Liquidity ratios calculate the capability of a firm to meet its short-term obligations.  These ratios are significant because not a success to pay such obligations can lead to bankruptcy.  In general, the elevated the liquidity ratio, the more capable a firm is to pay its short-term obligations.

 


Related Discussions:- Which ratios would a banker be most interested

Sources of finance, Classification of finance and abrief description of eac...

Classification of finance and abrief description of each source of fund

What is the operating leverage effect and what causes it, What is the opera...

What is the operating leverage effect and what causes it?  What are the potential benefits and negative consequences of high operating leverage? The operating leverage effect i

Calculate the future value of annuity, 1.  An investor is thinking of inves...

1.  An investor is thinking of investing in a recurring deposit scheme that offers an interest rate of 12% per annum. The investment that he is planning is for the higher education

Cost of preference equity-irr , 1.  Find out the present value of Rs. 10,00...

1.  Find out the present value of Rs. 10,000 to be required after 4 years if the interest rate is 6%. 2.  A Firm can invest Rs. 10,000 in a project with a life of three years.

Return risk and security market line /net present value .., return risk and...

return risk and security market line /net present value and investment critirea actually iwill be tested in 6 question culculation and 1 question theory about risks

Operating cycle, how to write a vegetation operating cycle

how to write a vegetation operating cycle

Leadership, AskThink back to a time when you have worked for a supervisor w...

AskThink back to a time when you have worked for a supervisor who moved from one leadership style to another based on situational variables described in the Long and Spurlock (2008

Standard communication protocol used for the internet, Question: (a) W...

Question: (a) What is a computer virus? List and explain the different type of computer viruses? (b) List 4 steps which you can use to minimize the chances of being infec

Treasury bills, T-Bills are issued to enable the government to tide o...

T-Bills are issued to enable the government to tide over short-term liquidity requirements with maturities varying from a fortnight to a year. These instruments a

Evaluation of credit policy, Q. What is Evaluation of Credit Policy? Ev...

Q. What is Evaluation of Credit Policy? Evaluation of Credit Policy: - A credit policy is prepared to maintain the investment in receivables at optimum level. Receivable Turnov

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd