Ratios Flashcards

1
Q

Working Capital Formula

A

Current assets - current liabilities

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2
Q

Current ratio formula

A

Current assets/Current liabilities

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3
Q

Acid-Test (Quick) Ratio

A

Cash+Cash equivalents + marketable securities + Net Receivables/ Current liabilities

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4
Q

Inventory Turnover

A

Cogs/Avg. inventory

365/Inv. Turnover= in days

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5
Q

AR Turnover

A

Net credit sales/Avg. AR

365/AR turnover = in days

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6
Q

Debt to Equity Ratio

A

Total liabilities/ Common Stock

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