DAIF Ratios Flashcards
Turn on capital employed - profitability
Profit from operations/total equity + NC liabs x 100
Return on shareholders funds - profitability
Profit after tax/total equity x 100
Gross profit margin - profitability
Gross profit/ revenue x 100
Expense/revenue percentage - profitability
Specified expense/revenue x 100
Operating profit margin - profitability
Operating profit (before tax and finance costs)/revenue x 100
Current ratio - liquidity
Current assets/current liabilities
Acid test - liquidity
Current assets - inventories/current liabilities
Interest cover - financial position
Operating profit/finance costs = number of times
Gearing - financial position
NC liabs/NC liabs + equity x 100
Inventory holding period - use of resources
Inventories/COS x 365 days. shorter is better
Inventory turnover - use of resources
COS/Inventories = number of times
Payables payment period - use of resources
Payables/COS x 365 days. Longer is better
Working capital cycle - use of resources
Inventory holding period + trade receivables collection period - payables payment period
Trade receivables collection period - use of resources
Receivables/revenue x 365 days
Asset turnover (net) - use of resources
Revenue/total assets - current liabilities = x times
