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CFA Level 1 - Quantitative Methods > Financial Reporting Ratios > Flashcards

Financial Reporting Ratios Flashcards

1
Q

Current Ratio

A

Current Assets / Current Liabilities

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2
Q

Quick Ratio

A

(Cash + Marketable Securities + receivables ) / Current Liabilities

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3
Q

Cash Ratio

A

(Cash + Marketable Securities) / Liabilities

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4
Q

Defensive Interval

A

(Cash + Marketable Securities + receivables) / daily cash expenditure

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5
Q

Receivables Turnover

A

annual sales / average receivables

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6
Q

Inventory Turnover

A

COGS / average inventory

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7
Q

Payables Turnover Ratio

A

Purchases / average trade payables

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8
Q

days of sales outstanding

A

365 / receivables turnover

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9
Q

days of inventory on hand

A

365 / inventory turnover

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10
Q

Number of Days of Payables

A

365 / payables turnover ratio

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11
Q

Cash Conversion Cycle

A

days of inventory on hand + days of sales outstanding - number of days payables

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12
Q

Total Asset Turnover

A

Revenue/ average total assets

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13
Q

Fixed Asset Turnover

A

Revenue / average fixed assets

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14
Q

Working Capital Turnover

A

Revenue / average working capital

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15
Q

Gross Profit Margin

A

gross profit / revenue

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16
Q

Operating Profit Margin

A

= operating profit / revenue

= EBIT / net sales

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17
Q

Net Profit Margin

A

= net income / revenue

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18
Q

Return on Assets

A

= EBIT / Average Total Capital

= [net income + interest expense (1 - tax rate)] / average total assets

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19
Q

Debt-to-Equity Ratio

A

Total Debt / Total Equity

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20
Q

Total-Debt Ratio

A

Total Debt / Total Assets

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21
Q

Interest Coverage

A

EBIT / interest

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22
Q

Fixed Charge Coverage

A

(EBIT + lease payments) / (interest + lease payments)

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23
Q

Growth Rate (g)

A

Retention Rate * Return on Equity

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24
Q

Retention Rate

A

1 - (dividends declared/operating income after taxes)

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25
DuPont Analysis
Return on Equity = (net income / sales)*(sales/assets)*(assets/equity) = net profit margin * asset turnover * Equity Multiplier
26
Extended DuPont Analysis
ROE = (net income / EBT)* ( EBT/EBIT) * (EBIT / Revenue) *(revenue / average total assets) *( Average Total assets / Average Equity) = tax burden * interest burden * EBIT margin * asset turnover * leverage
27
Basic EPS
=(net income - preferred dividends) / weighted average number of common shares outstanding
28
Diluted EPS
= ((net income - preferred dividends) + convertible preferred dividends + convertible debt interest * (1-t)) / (weighted average shares + shares from conversion of convertible preferred shares + shares from conversion of convertible debt + shares issuable from stock options) = adjusted income available for common shares / weighted average common shares plus potential common shares outstanding.
29
Straight Line Depreciation
(Cost - Residual Value) / useful life
30
Double Declining Balance Depreciation
( 2 / useful life) * (cost - accumulated depreciation)
31
Units of Production Depreciation
((Cost - salvage value) / useful life in units) * output units
32
Debt to Capital
Total debt / ( total debt + total shareholders' equity)
33
Debt-To-Assets
Total debt / Total assets
34
Financial Leverage
average total assets / average total equity
35
Pretax Margin
EBT / revenue
36
Operating ROA
= operating income / average total assets | = EBIT / average total assets
37
Return on total capital
EBIT / average total capital
38
Return on Equity
Net Income / Average Total Equity
39
Return on Common Equity
= (net income - preferred dividends) / average common equity
40
Free Cash Flow to the Firm
= net income + noncash charges + [ interest expense *(1-tax rate)] - fixed capital investments -working capital investment = CFO + [interest expense*(1 - tax rate)] -fixed capital investment
41
Free Cash Flow to Equity
CFO - fixed capital investment + net borrowing
42
common size income statement ratios
income statement account / sales
43
common size balance sheet ratios
balance sheet account / total assets
44
common size cash flow ratios
cash flow statement account / revenues
45
Coefficients of Variation sales
standard deviation of sales / mean sales
46
Coefficients of Variation operating income
standard deviations of operating income / mean operating income
47
Coefficients of Variation net income
standard deviation of net income / mean net income
48
ending inventory
= beginning inventory + purchases - COGS
49
FIFO COGS =
LIFO COGS - (ending LIFO reserve - beginning LIFO reserve)
50
Straight-line depreciation
cost-salvage value / useful life
51
Double Declining Balance
(2/useful life) * ( cost - accumulated depreciation)
52
Units of production depreciation
[(original cost - salvage value) / life in output units]* output units in this period
53
average age
accumulated depreciation / annual depreciation expense
54
total useful life
historical cost / annual depreciation expense
55
remaining useful life
ending net PP&E / annual depreciation expense
56
income tax expense
taxes payable + delta(DTL) - delta (DTA)
57
interest expense
(the marker rate at issue * the balance sheet value of the liability at the beginning of the period
58
cash flow - to - revenue
CFO / net revenue
59
cash return - on - assets
CFO / average total assets
60
cash return-on-equity
CFO / average total equity
61
cash - to - income
CFO / operating income
62
cash flow per share
(CFO - preferred dividends ) / ( weighted average number of common shares)
63
Debt Coverage
CFO / total debt
64
interest Coverage
(CFO + interest paid + taxes paid) / interest paid
65
reinvestment
CFO / cash paid for LT assets
66
debt payment
CFO / cash paid for LT debt repayment
67
dividend payment
CFO / dividends paid
68
investing and financing
CFO / cash outflows from investing and financing activities

CFA Level 1 - Quantitative Methods (29 decks)

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