Which ratios are liquidity, solvency, profitability, and market prospect? How are they calculated?
Liquidity - Inventory turnover (cost of goods sold/Average inventory) Account receivable turnover (net credit sales/average net accounts receivable) Days sales in receivables (average net accounts receivable/one day's sales)
Solvency - Current ratio (current assets/current liabilities), Acid test ratio (cash +short term investments + receivables / current liabilities)
Profitability - Rate of return on net sales (net income/net sales), rate of return on total assets (net income + expense / average total assets)
Market prospect - Price earnings ratio (market price per share of common stock/earnings per share), Dividend yield (annual dividend per share of common stock/market price per share of common stock), book value per share of common stock ( total stockholders equity-preferred equity/number of share of common stock outstanding)