Financial Ratios Flashcards
Net Profit Margin
Net Income / Revenue
Return on Assets (ROA)
Operating Income / Avg. Total Assets
ROE
Net Income / Avg. Shareholders Equity
Common Size for Balance Sheet
Total Assets
Common Size for Income Statement
Revenue
Common Size for Cash Flow Statement
Revenue, or Total Inflows and Total Outflows
Net Working Capital
Current assets - current liabilities
Describe Activity Ratios
How the company performs day-to-day taks (collection of receivables, management of inventory, etc.)
Describe Liquidity Ratios
Ability to meet short term oblications
Describe Solvency Ratios
Ability to meet long-term obligations
Describe Profitability Ratios
ability to generate profit from resources
Describe Valuation Ratios
the quantity of an asset or flow associate with ownership of a specific claim
Inventory Turnover Ratio
COGS / Avg. Inventory
Days of Inventory (DOH)
365 / Inventory Turnover Ratio
Receivables Turnover Ratio
Sales / Average Receivables
Days of Sales (DOS)
365 / Receivables Turnover Ratio
Payables Turnover Ratio
Purchase / Avg. Accounts Payable
Days of Payables
365 / Payables Turnover Ratio
Working Capital Turnover
Revenue / Avg. Working Capital
Fixed Asset Turnover
Revenue / Avg. net fixed assets
Total Asset Turnover
Revenue / Avg total assets
Current Ratio
Current Assets / Current Liabilities
Quick Ratio
(Cash + Marketable Securities + A/R) / Current Liabilities
Cash Ratio
(Cash + Marketable Securities) / Current Liabilities
