Type of Financial Ratios

In general, financial ratios can be classified as follows:
1. Profitability Ratios
The ratio used to measure a company's ability to generate profits for the company. These ratios include: GPM (Gross Profit Margin), OPM (Operating Profit Margin), NPM (Net Profit Margin), ROA (Return to Total Asset), ROE (Return On Equity).
2. Liquidity Ratio
This ratio is used to measure the company's ability to guarantee the liabilities - current liabilities. These ratios include ratios Cash (Cash Ratio), Quick Ratio (Quick Ratio) Current Ratio (Current Ratio)
3. Leverage Ratio
This ratio is used to measure the level of resource management company funds. This ratio is another anatar consists of the ratio of Total Debt to Equity, Total Debt to Total Assets.
4. Activity Ratio
This ratio describes the activities of the company in carrying out its operations in the activities of sales, purchases and other activities. There are two assessment activity ratios Ratios Market Value and RasioEfisieni / Turnover.
In this artkel, the author will not discuss in depth or detail the type - the type of ratio mentioned above as an explanation of each - each type of ratio and the calculation and implementation.