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FM (Test) > Ratios > Flashcards

Ratios Flashcards

1
Q

Correct calculation for capital employed to be used in ROCE?

A

Shareholder’s funds + long-term liabilities

Total assets - current liabilities

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2
Q

Gross profit margin?

A

Gross profit/Sales * 100

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3
Q

Operating margin?

A

PBIT/Sales * 100

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4
Q

ROCE?

A

PBIT/Capital employed * 100
OR

Operating Profit margin * asset turnover

Sales/capital asset turnover ratio

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5
Q

ROE?

A

(Profit after tax - preference dividends)/Ordinary shareholder funds * 100

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6
Q

Asset turnover?

A

Sales/Capital employed

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7
Q

Current ratio?

A

Current assets/Current liabilities

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8
Q

Quick ratio?

A

(Current assets - Inventory)/Current liabilities

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9
Q

Receivables collection period?

A

Average AR/Annual credit sales * 365 days

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10
Q

Payables payment period?

A

Average AP/Annual credit purchases * 365 days

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11
Q

Inventory holding period?

A

Average inventory/Annual COS * 365 days

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12
Q

Operating cycle?

A

Inventory + Receivables - Payables

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13
Q

Sales/working capital?

A

Sales/working capital

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14
Q

Debt to equity?

A

Non-current liabilities/(Capital + reserves) * 100

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15
Q

Debt to total capital?

A

Non-current liabilities/Capital employed * 100

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16
Q

Operational gearing?

A

Fixed operating costs/Variable operating costs * 100

Fixed operating costs/Total operating costs * 100

Contribution/PBIT

17
Q

Interest coverage?

A

PBIT/Interest expense

18
Q

Cash flow coverage?

A

Cash generated from operations/Interest expense

19
Q

EPS?

A

Profit after tax-preference dividends/Weighted average number of ordinary shares in issue

20
Q

Diluted EPS?

A

(Profit after tax-preference dividends + FDS adjustments) / (Ordinary dividend + PDS)

21
Q

P/E ratio?

A

Ordinary share price/EPS

22
Q

Dividend coverage?

A

Profit after tax-preference dividends / total rodinary dividend

23
Q

Dividend payout ratio?

A

Ordinary dividend / Profit after tax-preference dividends

24
Q

Dividend yield?

A

Dividend per share/Market price per share * 100

25
Q

Earnings yield?

A

EPS / Ordinary share price * 100

26
Q

Total shareholder return?

A

(Year end share price - share price at start of year + dividends for year) / Share price at start of year (old price) * 100

((Current share price + dividend for year)/share price at start of year) - 1

27
Q

Dividend for the year?

A

Interim dividend + final dividend

28
Q

Ex-div share price?

A

Cum-div - final dividend

29
Q

Benefit of high operational gearing (risk v reward)?

A

Greater risk but greater reward

30
Q

Contribution calculation?

A

Sales - variable costs

31
Q

Proportion of debt finance?

A

Debt/(Debt + Equity)

32
Q

Mean growth in EPS calcualtion?

A

n¬(final year/start year) - 1

33
Q

Is dividend coverage and dividend payout workings numerator and denominator flipped?

A

YES

FM (Test) (8 decks)

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