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Finance Ratios > Ratios > Flashcards

Ratios Flashcards

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1
Q

Net working capital

A

Current assets-current liabilities

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2
Q

Average daily cost of sales

A

(Total sales-gross profit)/365

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3
Q

Average daily sales

A

Total sales/365

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4
Q

Accounts receivable days

A

AR/(sales/365)

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5
Q

Accounts Payable Days

A

AP/((sales-gross profit)/365)

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6
Q

Inventory Days

A

Inventory/((sales-gross profit)/365)

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7
Q

Accounts Receivable Turnover

A

Sales/AR

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8
Q

Accounts Payable Turnover

A

Annual COGS/AP

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9
Q

Inventory Turnover

A

Annual COGS/Inventory

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10
Q

Debt/Equity Ratio

A

Total Debt/Total Equity

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11
Q

Debt/Capital Ratio

A

Total Debt/(Total equity+Total Debt)

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12
Q

P/E Ratio

A

Market Capitalization/Net Income
OR
Share Price/Earnings per Share

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13
Q

Gross Profit

A

Sales/COGS

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14
Q

ROE

A

Net Income/Book Value of Equity

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15
Q

Operating Margin

A

EBIT/Sales

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16
Q

Net Profit Margin

A

Net Income/Sales

17
Q

Enterprise Value

A

Mkt Value of Equity+Debt-Cash

18
Q

Interest Coverage Ratio using EBIT

A

EBIT/Interest Expense

19
Q

ROA

A

(Net Income+Interest Expense)/Book Value of Assets

20
Q

Return on Invested Capital

A

(EBIT(1-tax rate))/(Book Value of Equity+Net Debt)

21
Q

Dupont Identity

A

ROE=Net Profit Margin x Asset Turnover x Equity Multiplier

22
Q

Calculating Operating Cash Flow

A
  1. Start with Net Income
  2. ADD cash amount for an INCREASE in depreciation
  3. ADD cash amount for INCREASE in AP
  4. SUBTRACT cash amount for INCREASE in AR
  5. SUBTRACT cash amount for INCREASE in INV
23
Q

Calculating Investing Cash Flow

A
  1. ADD cash amount for INCREASE in Land,Building, and Equip (LT Assets)
  2. ADD cash amount for INCREASE in Goodwill
  3. ADD cash amount for increase in LT ASSETS
24
Q

Calculating Financing Cash Flow

A
  1. SUBTRACT cash amount Dividends paid
  2. ADD cash amount for Stocks Sold (Current Equity-NI-Div Paid-Prev. Year Equity)
  3. ADD cash amount for INCREASE in Notes Payable
  4. ADD cash amount for INCREASE in Maturity of LT Debt
  5. ADD cash amount for INCREASE in LT Debt
25
Q

Current Ratio

A

Current Assets/Current Liabilities

26
Q

Cash Ratio

A

Cash/Current Liabilities

27
Q

Gross Margin

A

Gross Profit/Sales

28
Q

EBIT Margin

A

EBIT/Sales

29
Q

Book Value of Equity

A

Total Assets-Total Liabilities

30
Q

Market Value of Equity

A

Shares outstanding x Current Market Price

31
Q

Enterprise Value ****

A

Market Value of Equity+Debt-Cash

32
Q

Market Capitalization

A

Shares outstanding X Current Market Price

Finance Ratios (1 decks)

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