Ratio Analysis Flashcards
Net Working Capital Formula
Current Asset - Current Liabilities
Current Ratio
Current Assets / Current Liabilities
- Cash and Cash Equivalents
- Marketable Securities
- Account Receivables
- Inventory
Quick Ratio - Acid Test Ratio
Current Asset - Inventory / Current Liabilities
- Cash and Cash Equivalents
- Marketable Securities
- Account Receivables
Cash Ratio
Current Asset - Inventory-A/R / Current Liabilities
- Cash and Cash Equivalents
- Marketable Securities
Inventory Turnover
COGS / Average Inventory
Inventory Conversion Period
365 / Inventory Turnover
Days in Inventory
Ending Inventory / (COGS / 365)
Average Accounts Receivable Turnover
Credit Sales / Average Accounts Receivable
Receivables Collection Period
365 / Average Accounts Receivable Turnover
Accounts Payable Turnover
Purchases / Average Accounts Payable
Payable Conversion Period
365 / Accounts Payable Turnover
Days in Receivables
Net Ending Accounts Receivable / (Net Sales / 365)
Days Sales in Accounts Payable
Net Ending Accounts Payable / (COGS / 365)
Asset Turnover
Total Sales / Average Total Assets
Net Profit Margin
(Revenue - Expenses = Net Profit) / Revenue
Gross Margin
(Revenue - COGS) / Revenue
Return on Asset (ROA)
Net Income / Average Total Assets
Return on Equity (ROE)
Net Income / Average Shareholder’s Equity
Return on Investment (ROI)
Net Income / Average Invested Capital
Solvency Ratios
- Total Debt Ratio / Debt -to-Total Assets
- Debt to Total Capital
- Debt to Equity
- Time Interest Earned
Debt to Capital
Total Debt / Total Capital
Debt to Equity
Total Debt / Total Equity
Times Interest Earned Ratio
EBIT / Interest Expense
Price to Sale Ratio
Market Price / Expected Sales
