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9 terms

Financial Accounting Ratios

STUDY
PLAY
Current Ratio
Current assets
/
Current liabilities
Acid-Test Ratio
(Cash + Short-term investments + Net current receivables)
/
Current liabilities
Inventory Turnover
COGS
/
Average inventory
A/R Turnover
Net credit sales
/
Average net A/R
Debt Ratio
Total liabilities
/
Total assets
ROS
Net income
/
Net sales
ROA
(Net income + Interest expense * (1 - tax rate))
/
Average total assets
ROE
(Net income - Preferred dividends)
/
Average Common SE
EPS
(Net income - Preferred dividends)
/
Average number of shares of common stock outstanding