Chapter 3 - Working with Financial Statements Flashcards
Quick ratio
(Current assets - Inventory)/ Current liabilities
Current ratio
Current assets/ Current liabilities
Cash ratio
Cash/ Current liabilities
Net working capital to total assets
Net working capital/ Total assets
Interval measure
Current assets/ Average daily operating costs
Inventory turnover
Costs of goods sold/ Inventory
Days’ sales in inventory
365 days/ Inventory turnover
Receivables turnover
Sales/ Accounts receivable
Days’ sales in receivables
365 days/ Receivables turnover
Net working capital turnover
Sales/ NWC
Fixed asset turnover
Sales/ Net fixed assets
Total asset turnover
Sales/ Total assets
Total debt ratio
(Total assets - Total equity)/ Total assets
Debt-equity ratio
Total debt/ Total equity
Equity multiplier
Total assets/ Total equity
Long-term debt ratio
Long-term debt/ (Long-term debt + Total equity)
Times interest earned ratio
EBIT/ Interest
Cash coverage ratio
(EBIT + Depreciation)/ Interest
Profit margin
Net income/ Sales
Return on assets (ROA)
Net income/ Total assets
Return on equity (ROE)
Net income/ Total equity
ROE
(Net income/Sales) x (Sales/Assets) x (Assets/Equity)
Price-earnings ratio
Price per share/ Earnings per share
PEG ratio
Price-earnings ratio/ Earnings growth rate (%)
Price-sales ratio
Price per share/ Sales per share
Market-to-book-ratio
Market Cap/ Total Equity
Tobin’s Q ratio
Market value of assets/ Replacement cost of assets
Operating Cash Flow
EBIT + Depreciation - Taxes
