Liquidity & Profitability Ratios Flashcards

1
Q

What is the formula for the current ratio?

A

Current Assets/Current Liabilities:1

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2
Q

What is the formula for the Liquid Capital ratio?

A

Current Assets - Inventory/ Current Liabilities

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3
Q

What is the formula for the gross profit margin?

A

(Gross Profit/ Revenue) x 100 = x%

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4
Q

What is the formula for the markup?

A

(Gross Profit/Cost of sales) x 100 = x%

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5
Q

What is the formula for Expenses in relation to Revenue?

A

(Expenses/Revenue) x 100 = x%

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6
Q

What is the formula for profit in relation to revenue?

A

(Profit for the year before tax/Revenue) x 100 = x%

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7
Q

What is the formula for the Return on Capital Employed?

A

(Profit from operations/Capital Employed) x 100 = x%

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