Ratio Calculations Flashcards
What’s 3 examples of current assets?
Inventory
Receivable
Cash
What’s 3 examples of current liabilities?
Overdraft
Payables
Wages/Expenses
What are 2 examples of non-current assets?
Machinery
Property
What are 2 non-current liabilities?
Loans
Mortgages
What’s shareholder equity?
What you sell in shares
How is net assets calculated?
Total assets minus total liabilities
How do you calculate return on capital employed?
Operating Profit or net profit divided by capital employed X100
How do you calculate capital employed?
Total assets minus current liabilities
How do you calculate gross profit margin?
Gross Profit divided by revenue X100
How do you calculate operating profit margin?
Operating Profit divided by revenue X100
How do you calculate profit for year margin?
Profit for the year divided by revenue X100
How do you calculate current ratio?
Current assets divided by current liabilities
How do you calculate gearing?
Non-current liabilities divided by capital employed X100
How do you calculate payable days?
Payables divided by cost of sales X365
How do you calculate receivable days?
Receiveables divided by revenue X365
How do you calculate inventory turnover?
Cost of sales divided by average inventory held
How do you calculate operating profit?
Gross profit minus expenses
How do you calculate gross profit?
Revenue - cost of sales
What are current assets?
Assets that can be turned into cash within a year
What are non-current assets?
Assets that can’t be liquidated into cash within a year
What are current liabilities?
Short-term debts that are usually paid within a year
What are non-current liabilties?
Not settled within a year e.g mortgages and loans
