The working capital ratio, calculated by dividing current assets by current liabilities, measures a company’s short-term financial health and operational efficiency. A ratio above 1 indicates that a company has sufficient assets to cover its liabilities, while a ratio below 1 may signal potential liquidity issues. This formula is crucial for investors and managers to assess a business’s ability to meet its short-term obligations.
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Emagia is a leading provider of AI-powered Order-to-Cash (O2C) automation platform that modernizes finance operations for midsize to large global businesses. Many global businesses and shared service centers use Emagia’s Autonomous O2C to transform to digital world-class operations in credit, invoicing and payments, receivables, collections, deductions, cash application and cash forecasting. Emagia solutions improve their customers DSO, cash flow, credit risk, operational cost, compliance and profitability.
