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Financial Markets > Accouting Ratios > Flashcards

Accouting Ratios Flashcards

1
Q

Profitability ratios

A 
ROCE
Gross Profit Margin
Operating Profit Margin
Asset Turnover
Operational Gearing Ratio
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2
Q

ROCE formula

A

Operating Profit / Capital Employed x 100

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3
Q

Gross Profit Margin formula

A

Gross Profit / Revenue x 100

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4
Q

Operating Profit Margin formula

A

Operating Profit / Revenue x 100

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5
Q

Asset Turnover formula

A

Revenues / Capital Employed (assets used in business)

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6
Q

Operational Gearing Ratio formula

A

(Revenues - variable costs) / Operating Profit

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7
Q

Liquidity ratios

A

Current Ratio
Quick (acid test) Ratio
Working Capital measures (receivables collection period; payables payment period; inventory turnover)

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8
Q

Current Ratio formula

A

Current assets / Current Liabilities

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9
Q

Quick (acid test) Ratio formula

A

(Current Assets - Inventory) / Current Liabilities

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10
Q

Receivables collection period formula

A

Outstanding trade receivables / Revenue x 365

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11
Q

Payables Payment Period formula

A

Outstanding Trade Payables / cost of sales x 365

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12
Q

Inventory Turnover formula

A

Cost of goods / Inventory

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13
Q

Gearing ratios

A

Debt to Equity

Interest Cover

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14
Q

Debt to Equity Ratio formula

A

(Interest Bearing Loans + Preferential Share Capital) / Equity Shareholders’ Funds x 100

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15
Q

Interest cover formula

A

(Operating Profit + Interest Receivables + Other Receivables) / Interest Payable

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16
Q

Investor Ratios

A 
EPS
ROE
PE Ratio
PEG Ratio
EBITDA
EV
17
Q

EPS formula

A

Net profit to ordinary shareholders / Av no ordinary shares in issue

18
Q

ROE Formula

A

Net profit to ordinary shareholders / Ordinary Shareholders Funds x 100

19
Q

PE Ratio formula

A

Ordinary share price / EPS

20
Q

PEG Ratio Formula

A

PE Ratio / Expected Growth Rate in Earnings

21
Q

EBITDA formula

A

Revenue - expenses (excluding tax, Interest, depreciation and amortisation

22
Q

EV formula

A

(Market cap + outstanding debt + pref shares + minority shares) - (cash + cash equivalents)

23
Q

Yield ratios

A

Earnings yield

Dividend yield

24
Q

Earnings Yield formula

A

EPS / Share price x 100

25
Q

Dividend Yield formula

A

DPS / Share price x 100

Financial Markets (3 decks)

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