Formulas Flashcards
Purchase is based on
What you need - What you have
What you need
Sales + What you need for end inventory
(Gross) Profit
Revenues - Cost Of Goods Sold
Market to Book Ratio
Market Value (per share) / Book Value (per share)
OR
Market Value / Book Value
Total Equity
common stock + paid in premium + retained earnings
Goodwill
(Price paid per share - book value per share) * Number of shares bought
OR
Total price paid - book value of shares bought
Book value per share
(total equity) / number of outstanding shares
Current Ratio
current assets / current liabilities
Quick Ratio
(current assets - inventory) / current liabilities
Net working capital
current assets - current liabilities
Debt ratio
Total debt / total assets
Debt to equity ratio
Total debt / total equity
Times interest earned
EBIT / Interest charge
Return on Equity (ROE)
Annual Profit / Equity * 100%
Return on Debt (ROD)
Annual Interest / Total Debt * 100%
Return on Investment (ROI)
Annual EBIT / Total Investment * 100%
Margin on Sales
EBIT / Sales
OR
Sales Price - Purchase Price * amount of sales
Leverage Effect
ROE = ROI + [(ROI-ROD) * (Debt / Equity)]
Average Collection Period
(Accounts Receivables / Annual Sales) * 365
Average Inventory Period
(Inventory Level / Annual Cost of Sales) * 365
Turnover Rate
Annual Sales / Total Assets
Earnings Per Share (EPS)
Net Income / Number of Outstanding Shares
Price Earnings Ratio (P/E Ratio)
Market Price of a Share / EPS
Dividend Yield
Dividend per Share / Market Price per Share (at beginning of the year)
Total Yield
(Dividend per Share + Market Price Change) / Market Price per Share (at the beginning of the year)
Dividend Cover
Net Earnings / Dividends
Pay Out Ratio
Dividends / Net Earnings
