Accounting Ratios

Question 1

Current Ratio

Answer 1

Current Assets/Current Liabilities

Question 2

Quick Ratio

Answer 2

Question 3

Cash Ratio

Answer 3

Question 4

Defensive Interval Ratio

Answer 4

Question 5

Receivables Turnover Ratio

Answer 5

Question 6

Days Of Sales Outstanding

Answer 6

Question 7

Inventory Turnover Ratio

Answer 7

Question 8

Days of Inventory On hand

Answer 8

Question 9

Payables Turnover Ratio

Answer 9

Question 10

Number of Days Payables

Answer 10

Question 11

Cash Conversion Cycle

(Net Operating Cycle)

Answer 11

DOH + DSO - # Days Payable

Question 12

Working Capital Turnover Ratio

Answer 12

Total Revenue / Average Working Capital

Question 13

Fixed Asset Turnover Ratio

Answer 13

Total Revenue / Average Net Fixed Assets

Question 14

Total Asset Turnover Ratio

Answer 14

Total Revenue / Average Total Assets

Question 15

Gross Profit Margin

Answer 15

Gross Profit / Total Revenue

Question 16

Operating Profit Margin

Answer 16

Operating Profit / Total Revenue

Question 17

Pretax Margin

Answer 17

Earnings Before tax but after interest / total revenue

Question 18

Net Profit Margin

Answer 18

Net income / Total Revenue

Question 19

Operating ROA

Answer 19

Operating Income / Average Total Assets

Question 20

ROA

Answer 20

NI / Avg Total Assets

Question 21

ROE

Answer 21

NI / Avg SH Equity

Aka 1 Part Dupont :)

Question 22

Return on Total Capital

Answer 22

EBIT / EQ + Int Bearing Debt

Question 23

Return on Common Equity

ROCE

Answer 23

NI -Pref Divs / Avg Sh EQ

Question 24

Tax Burden

Answer 24

NI / EBT

Dupont Component

Question 25

Interest Burden

Answer 25

EBT / EBIT ## Footnote Dupont Component

Question 26

EBIT Margin

Answer 26

EBIT / Total Revenue ## Footnote Dupont Component

Question 27

Financial Leverage Ratio

Answer 27

Total Assets / Total Equity ## Footnote Dupont Component

Question 28

Total Debt

Answer 28

The total of interest bearing short term and long term debt, Excluding liabilities such as accrued expenses and accounts payable

Question 29

Debt to Assets Ratio

Answer 29

Total Debt / Total Assets

Question 30

Debt to Equity Ratio

Answer 30

Total Debt / Total SH Equity

Question 31

Debt to Capital Ratio

Answer 31

Total Debt / Total Debt + Total SH Equity

Question 32

Interest Coverage Ratio

Answer 32

EBIT / Interest Payments

Question 33

Fixed Charge Coverage Ratio

Answer 33

EBIT + Lease Payments / Int Payments + Lease Payments

Question 34

Dividend Payout Ratio

Answer 34

Common Div / NI attributable to Common Shares

Question 35

Retention Rate

Answer 35

NI attributable to common shares - common share Divs / NI ## Footnote Also 1 - Payout Ratio

Question 36

Sustainable Growth Rate

Answer 36

RR \* ROE

Question 37

Earning Per Share EPS

Answer 37

NI - Pref Div / Weighted Avg of Shares Outstanding

Question 38

Book Value Per Share

Answer 38

Common SH Equity / Total # Shares Outstanding

Question 39

FCFE

Answer 39

Cash Flow From Operating Activites - Investment in Fixed capital + Net borrowing

Question 40

FCFF

Answer 40

Cash flow from Operating Activities + Interest Expense \* (1-Tax Rate) - Investment in Fixed Capital