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Thursday, June 2, 2011

Cash Flow Ratios Analysis & Formula

Cash Flow Ratios are used to assess the cash position of the business. Following are the main cash flow-based financial ratios and the calculations:

Formula:
1) Cash Flow to Assets Ratio = Cash flow from operations / Opening assets + Closing assets / 2
2) Price to Cash Flow Ratio = Market price per share / Cash flow per Share
3) Free Cash Flow Ratio = Cash from operations - dividends paid - (

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