Accounting Ratios Flashcards
1
Q
Gross profit margin
A
Gross profit/sales X 100
2
Q
Net profit margin(profit in relation to revenue)
A
PBIT/sales X 100
3
Q
Mark up (percentage)
A
Gross profit/ cost of sale X 100
4
Q
Return on capital employed
A
Profit from operations/capital employed X 100
5
Q
Current ratio
A
Current assets/ current liabilities
6
Q
Liquid capital ratio
A
Current assets-inventory/current liabilities
7
Q
Rate of inventory turnover
A
Cost of goods sold/average inventory
8
Q
Rate of inventory turnover (days)
A
Average stock/cost of inventory sold X 365
