Ratios Flashcards
Current Ratio
Current assets / current liabilities
Quick ratio
Quick assets / current liabilities
Inventory turnover
cogs / average inventory
days supply in inventory
365 / inventory turnover
AR turnover
Net credit sales / average AR
days sales in AR
365 / AR turnover
total asset turnover
net sales / average total asset
return on assets
(net income + AFTER TAX interest expense) / average total assets
return on CS equity
(net income - preferred dividends)/average CS equity
PE ratio
market price per CS / earnings per share
dividend yield
dividend per CS/market price per CS
Profit margin (also called profit margin on sales)
net income / sales
debt to equity ratio
total liabilities / shareholders equity
Equity ratio
total shareholders equity / total assets
times interest earned
(net income + interest expense + income tax expense) / interest expense
Gross margin percentage
(sales-cogs) / sales
Margin on cost
(sales-cogs) / cogs
Times preferred dividends earned ratio
net income / preferred stock dividends
Dividend payout ratio
common dividends / net income
Book value per P/S
(P/S equity + dividends in arrears) / # of outstanding P/S
Book value per C/S
C/S equity / # of outstanding C/S
Debt ratio (NOT the debt to equity ratio)
Total liabilities / Total assets
Owners Equity Ratio
S/H equity / total assets
C/S Yield
Dividend per C/S / Market price per C/S
Earnings per share
(NI - P/S dividends) / Weighted average shares outstanding
Return on Equity
NI / Average S/H equity
Ending Inventory (at cost) =
Ending Inventory (at retail) * (Cost/retail ratio)
Bonus calculation
Bonus = % * (Cash paid - Bonus)
What is the equation to recognize gross profit for the percentage of completion method for contract revenues?
revenue = costs incurred to date / (costs incurred to date + estimated costs to complete)
