Investment Appraisal Flashcards
1
Q
Return on capital employed (ROCE)
A
Profit before tax and interest/long term capital employed*100
2
Q
Gross profit margin
A
Gross profit/turnover*100
3
Q
Net profit margin
A
Net profit/turnover*100
4
Q
Return on equity
A
Net profit/equity
5
Q
Asset turnover
A
Turnover/net assets
6
Q
Stock turnover
A
Cost of sales/stock
7
Q
Debtor collection period
A
Debtors/turnover*365
8
Q
Creditor payment
A
Creditors/cost of sales*365
9
Q
Current ratio
A
Current assets/current liabilities
10
Q
Acid test ratio
A
Current assets-stock/current liabilities
11
Q
Gearing ratio
A
Fixed cost capital/long term capital*100
12
Q
Interest cover
A
Profit before tax and interest /interest
13
Q
Earnings per share
A
Profit after tax/number of shares
14
Q
Dividend per share
A
Dividend/number of shares
15
Q
Dividend yield
A
Dividend per share/share price
