finance

Question 1

Current ratio

Answer 1

total current assets/total current liabilities

Question 2

Quick ratio

Answer 2

total current assets - inventory\
total current liabilities

Question 3

Inventory turnover

Answer 3

COGS/Inventory

Question 4

average age inventory

Answer 4

365/inventory turnover

Question 5

average collection period

Answer 5

accounts receivable/ annual sales/365

Question 6

average payment period

Answer 6

accounts payable/ annual purchases/365

Question 7

total assets turnover

Answer 7

net sales/total assets

Question 8

debt ratio

Answer 8

total liabilities / total assets

Question 9

times interest earned

Answer 9

EBIT/Interest

Question 10

gross profit margin

Answer 10

gross profit/net sales

Question 11

operating profit margin

Answer 11

operating profits/net sales

Question 12

net profit margin

Answer 12

earnings available to common stockholders/ sales

Question 13

earnings per share

Answer 13

earnings available to common stockholders/ number of shares outstanding

Question 14

return on total assets

Answer 14

earnings available to common stockholders/ total assets

Question 15

DuPont system of analysis

Answer 15

ROA= Net profit margin X total asset turnover

Question 16

return on common equity

Answer 16

earnings available to common stockholders/ common stock equity

Question 17

price/earnings ratio

Answer 17

market price per share of common stock/ earnings per share

Question 18

book value per share

Answer 18

common stock equity/ number of shares of common stock

Question 19

market/book ratio

Answer 19

market price per share of common stock/ book value per share of common stock