Essential CFA Financial Ratios

Master key financial ratios required for the CFA exam, including formulas and interpretations for liquidity, leverage, and profitability analysis.

What is the current ratio formula?

Voorkant

Current Ratio = Current Assets / Current Liabilities

Achterkant

What does the quick ratio measure?

Voorkant

The quick ratio measures a company's ability to meet short-term obligations with its most liquid assets.

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What is the formula for Return on Equity (ROE)?

Voorkant

ROE = Net Income / Shareholder's Equity

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What does the interest coverage ratio indicate?

Voorkant

It indicates how easily a company can pay interest on its outstanding debt.

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How is the debt-to-equity ratio calculated?

Voorkant

Debt-to-Equity Ratio = Total Debt / Total Equity

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