|
|
| Cash
Flow to Assets |
= |
Cash
from Operations |
|
Total
Assets |
|
This
ratio indicates the cash a company can generate in relation to its
size.
Things
to remember |
- Comparing to previous years is important, if the company's
ratio is decreasing then they may eventually run into
cash problems.
|
|
|
[Click
on the image(s) above to see the financial statements] |
For
Cory's Tequila Co. |
$4,438 |
=
0.30 |
$14,725 |
|
Cash Flow to Assets Analysis:
Cash flow is often overlooked when people analyze a company. You
can be a profitable company but if you don't have cash moving around
to pay bills then you are really in trouble. It relates a company's
ability to generate cash compared to its asset size. A ratio of
0.30 is quite good, Cory's Tequila Co. shouldn't run into any problems
generating cash. When the ratio declines below 10% then there may
be some cause for concern.
|
|
|
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