working capital turnover ratio meaning
The fixed assets turnover ratio measures the efficiency of a companys long-term capital investments. Working toward and attaining financial security requires businesses to understand their accounts receivable turnover ratio.
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A higher working capital turnover ratio is always better.
. If a companys receivables turnover goes. This efficiency ratio takes an organizations receivable balances and receivable accounts into consideration to determine the state of its cash flow. Material Cost Variance gives an idea of how much more or less cost has been incurred when compared with the standard cost.
The difference between the standard cost of direct materials specified for production and the actual cost of direct materials used in production is known as Direct Material Cost Variance. A higher working capital indicates that a company is utilizing its working capital very efficiently. Material Cost Variance.
As a thumb rule a low or decreasing trend witnessed in acid test ratio usually indicates that an entity may be having weak top-line growth struggling to manage working capital Manage Working Capital Working Capital Management refers to the management of the capital that the company requires for financing its daily business operations. A low working capital ratio is an indicator that the company is not operating at its optimum. Accounts Receivable Turnover Ratio Explained.
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