Test 1 - Formulas Flashcards
Working Capital
=Current Assets-Current Liabilities
Current Ratio
=Current Assets/Current Liabilities
Quick Ratio
=(Current Assets-Inventories-Prepaid Expenses)/Current Liabilities
Inventory Turnover
=COGS/Avg. Inventory
Average Inventory
=(Inv from current balance sheet+Inv from previous balance sheet)/2
Asset Turnover
=Sales/Total Assets
GMROII
=Total GM/Avg Inventory
% Gross Margin
Gross Margin/Net Sales
Net Profit Margin
=Net Income/Net Sales
Return on Assets
=Net Income/Total Assets
Return on Equity
=Net Income/Shareholders’ Equity
Financial Leverage
=Assets/Owner’s Equity
Net Assets
=Total Assets-Current Liabilities
DSO
=Accounts Receivable/Sales*365
DPO
=Accounts Payable/COGS*365
Days of Inventory
=Average Inventory/COGS*365
Cash Conversion Cycle
=DSO+DOI-DPA
COGS
=Cost of Merchandise-Freight form Manufacturer
ROI
=(Revenues-Expenses)/Assets
Accounting Equation
Assets=Liabilities-Stockholder’s Equity
