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CPA - FAR > FAR - Ratios > Flashcards

FAR - Ratios Flashcards

1
Q

What is the quick ratio?

A

Cash & cash equivalents + short term marketable securities (ie trading) + receivables net divided by current liabilities

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2
Q

What is the formula for AR Turnover?

A

Credit Sales net divided by avg AR net

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3
Q

What is the formula for days sales in AR?

A

Ending accounts Receivable net divided by (sales/365)

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4
Q

What is the formula for Inventory Turnover?

A

COGS divided by Average Inventory

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5
Q

What is the formula for Days in Inventory?

A

Ending Inventory divided by (COGS / 365)

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6
Q

What is the formula for AP Turnover?

A

COGS divided by Average AP

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7
Q

What is the formula for Return on Equity?

A

Net Income divided by Average Total Equity

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8
Q

What is the formula for Return on Sales?

A

Income before interest income, interest expense, and taxes divided by Sales (net)

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9
Q

What is the formula for Gross (Profit) margin?

A

(Sales net - COGS) divided by sales net

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10
Q

What is the formula for Operating Cash Flow Ratio?

A

Cash flow from operations divided by current liabilities

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11
Q

What is the formula for debt to equity?

A

Total liabilities divided by total equity

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12
Q

What is the formula for total debt ratio?

A

Total liabilities divided total assets

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13
Q

What is the formula for the equity multiplier?

A

Total assets divided total equity

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14
Q

What is the formula for times interest earned?

A

Income before interest expense and taxes divided by interest expense

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15
Q

What is the price to earnings ratio?

A

Stock price per share divided by basic earnings per share

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16
Q

What is the formula for dividend payout?

A

Cash dividends divided by net income

17
Q

What is the formula for AR turnover in days?

A

First calculate AR turnover then divided 365 by AR turnover

18
Q

What is the formula for the working capital turnover ratio?

A

sales divided by average working capital balance

CPA - FAR (16 decks)

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