Fin Exam Quan Formulas to know

Question 1

Current Ratio

Answer 1

Current Assets/ Current Liabilities

Question 2

Quick Ratio

Answer 2

Current Assets - Inventory/ Current Liabilities

Question 3

Debt Ratio

Answer 3

Total Debt/ Total Assets

Question 4

Profit Margin

Answer 4

NIAT/ Sales

Question 5

Asset Turnover

Answer 5

Net Ssles/ Avg Total Assets

Question 6

Return on Equity

Answer 6

Net Income/ Stockholder’s Equity (Total Debt -Debt = Equity)

Question 7

DOL

Answer 7

(S – VC) / (S – VC – FC)

Question 8

DFL

Answer 8

EBIT / (EBIT – I)

Question 9

DCL

Answer 9

(S – VC) / (S – VC – FC – I)

Question 10

Reg Bank Loan

Answer 10

I = P X R X T

I= cost of money/proceeds of loan * 360/#days of loan

Question 11

Discounted bank loan

Answer 11

Ex: 2/15/n45

2/100-2 * 360/45-15

Question 12

Discounted Compensating Balance bank loan

Answer 12

cost/ $ owed - cost of reg loan

Question 12

Regular Compensating Balance bank loan

Answer 12

amount needed/1-CB%

Question 13

amortization schedule for first 5 periods

Answer 13

-find the payment or PV
-put original balance for period 1 beginning balance
-calc monthly interest rate (interestrate/ 12 months) ; Beginning balance * monthly interest rate
-principal: pv - mothly interest rate
-ending balance: bginning balancr - prinicpal

-use end balance of period 1 for beginnning balance of year 2