Ratios Flashcards
List the formula for determining Operating Cycle Length.
Days’ Sales in Accounts Receivable + Days’ Supply in Inventory.
List the Accounts Receivable Turnover ratio formula.
Net Credit Sales / Average Net Accounts Receivable.
List the working capital ratio formula.
Current Assets / Current Liabilities.
List the formula for the Acid Test or Quick Ratio.
(Cash + Net Receivables + Marketable Securities) / Current Liabilities.
List the cash availability or interval ratio formula.
(Cash + Net Receivables + Marketable Securities) / Average Daily Cash Expenditures.
List the formula for inventory turnover.
Cost of Goods Sold (COGS) / Average Inventory.
List the formula for times preferred dividend.
Net Income / Annual Preferred Dividend Obligation.
List the formula for Number of Days’ Sales in Accounts Receivable (AR).
365/ AR Turnover.
List the formula for working capital.
Current Assets - Current Liabilities.
List the formula for number of days’ supply in inventory.
365/ Inventory Turnover.
List the formula for times interest earned.
(Net Income + Interest Expense + Income Tax Expense) / Interest Expense.
List the return on total assets formula.
(Net Income + Interest Expense (net of tax)) / Average Total Assets.
List the price to earnings ratio formula.
Market Price for a Common Share / Earnings Per Share (EPS).
List the common stock yield formula.
Dividend per Common Share / Market Price per Common Share.
List the return on common stockholders’ equity formula.
(Net Income-Current Period Preferred Dividend Obligation) / Average Common Stockholders’ Equity.
List the profit margin formula.
Net Income/Net Sales.
List the debt to equity ratio formula.
Total Liabilities / Total Shareholders’ Equity.
List the book value per preferred share ratio formula.
Preferred Shareholders’ Equity (including dividends in arrears) / Number of Outstanding Preferred Stocks.
List the book value per common stock ratio formula.
Common Shareholders’ Equity / Number of Outstanding Common Shares.
List the return on owner’s equity formula.
Net Income / Average Stockholders’ Equity.
List the total common stock dividend payout rate formula.
Cash Dividends to Common Shareholders / Net Income to Common Shareholders.
List the owner’s equity ratio formula.
Shareholders’ Equity / Total Assets.
List the per share common stock dividend pay out rate formula.
Cash Dividends per Common Share / Earnings Per Share (EPS).
List the debt ratio formula.
Total Liabilities / Total Assets.
