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The operating cash flow ratio, calculated by dividing operating cash flow by current liabilities, measures a company's ability to cover its short - term liabilities

The operating cash flow ratio, calculated by dividing operating cash flow by current liabilities, measures a company's ability to cover its short-term liabilities with cash generated from operations. A higher ratio indicates strong liquidity and financial health, suggesting the company can easily meet its short-term obligations. This ratio is important for stakeholders to evaluate the company's cash flow management and operational efficiency, providing insights into its financial stability and sustainability.

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