Treasury Analyst Mock Interview

Master 25 Treasury Analyst interview questions covering cash management, forecasting, and risk assessment.

Question 11 of 25

What is the working capital ratio and what does it tell about a companyâ€™s finances?

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Brian Schuchart is a CPA and Senior Finance Business Partner. His professional experience includes senior management roles with NBC Sports, Virtual Health, and the Children's Hospital of Philadephia.

The working capital ratio is a common and important way to measure a company's financial liquidity. The working capital ratio is calculated by dividing current assets by current liabilities. Higher ratios mean a greater flexibility to expand operations.

Brian Schuchart

Brian Schuchart is a CPA and Senior Finance Business Partner. His professional experience includes senior management roles with NBC Sports, Virtual Health, and the Children's Hospital of Philadephia.

"The working capital ratio indicates a company's ability to pay off their current liabilities as they become due. The ratio is calculated by dividing current assets by current liabilities. A ratio of two or higher would likely indicate that the company is in a good position to pay off its liabilities. Anything less than one would be considered problematic."

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