# Study sets matching "accounting ratios"

Study sets

Diagrams

Classes

Users

Current Ratio

Quick ("Acid Test") Ratio

Interest Coverage (Times Interest Earne…

Return on Assets (ROA)

Current Assets/Current Liabilities... Firm's ability to meet its…

(Cash + Marketable Securities + Accounts Receivable)/Current L…

EBIT/Interest Expense... Indicates the relative protection that…

Net Income/Average Total Assets... Firm's performance in using a…

Current Ratio

Current Assets/Current Liabilities... Firm's ability to meet its…

Quick ("Acid Test") Ratio

(Cash + Marketable Securities + Accounts Receivable)/Current L…

current ratio

quick or acid test

return on equity

return on capital employed

the higher this ratio, the more able a company is to pay back…

an indicator of whether a firm has enough short term assets to…

compares net income to average shareholder equity; measures ho…

possibly better than return on equity because it shows how wel…

current ratio

the higher this ratio, the more able a company is to pay back…

quick or acid test

an indicator of whether a firm has enough short term assets to…

Earnings Per Share

Profit Margin Ratio

Return on Investment

Working capital

**profitability ratio**... meausers the net income earned on each s…

**Profitability ratio**... measures amount of net income earned wit…

Net Profit... -------------------... Common stock... *Profitability rat…

**Liquidity Ratio**... Current Assets - Current Liabilities

Earnings Per Share

**profitability ratio**... meausers the net income earned on each s…

Profit Margin Ratio

**Profitability ratio**... measures amount of net income earned wit…

Current Ratio

Acid-test ratio

Accounts receivable turnover

Inventory turnover

Current assets / current liabilities

Cash+ short-term investments + current receivables /current li…

Net Sales / Average accounts receivable, net

COGS / Average inventory

Current Ratio

Current assets / current liabilities

Acid-test ratio

Cash+ short-term investments + current receivables /current li…

Profitability

Managerial Effectiveness

Financial Stability

Cash Flow

%Gross Profit... %Net Profit... %Return on Equity... %Return on Assets

(Days)Turnover of Inventories Rate... (Days)Turnover of A/c Recei…

_:1 Current... _:1 Quick... %Debt... %Equity

%Cash Flow to Revenue... %Cash Flow Adequacy... (Times)Long-term Deb…

Profitability

%Gross Profit... %Net Profit... %Return on Equity... %Return on Assets

Managerial Effectiveness

(Days)Turnover of Inventories Rate... (Days)Turnover of A/c Recei…

Current Ratio (Up or down?)

Current Ratio

Gross Margin Ratio (Up or down?)

Gross Margin Ratio

^ 2:1 Ratio is good, Used with the Balance Sheet

Explains what a comfortable amount of working capital is, the…

^ is better shows direct profit from sales, Used with the Inco…

It is the excess of Sales of COGS, it generally shows profitab…

Current Ratio (Up or down?)

^ 2:1 Ratio is good, Used with the Balance Sheet

Current Ratio

Explains what a comfortable amount of working capital is, the…

working capital

current ratio

inventory turnover

days in inventory

=current assets - current liabilities... liquidity ratio

=current assets/ current liabilities... liquidity ratio... 1.25: com…

=cost of goods sold/ average inventory... liquidity ratio... 8: comp…

=365 days/ inventory turnover... liquidity ratio... 46: company take…

working capital

=current assets - current liabilities... liquidity ratio

current ratio

=current assets/ current liabilities... liquidity ratio... 1.25: com…

gearing

leverage

high leverage

high gearing

The relationship between the debt and the equity of a business…

The relationship between the debt and the equity of a business…

There is a high level of borrowed external funds compared to i…

There is a high level of borrowed external funds compared to i…

gearing

The relationship between the debt and the equity of a business…

leverage

The relationship between the debt and the equity of a business…

Return on Equity (ROE)

Return on Assets (ROA)

Earnings per Share (EPS)

Quality of Income

Net Income/Average Stockholder's Equity

Net Income/Average total Assets

Net Income/ Average number Common Shares Outstanding

Net Cash from Operating Activities/Net Income

Return on Equity (ROE)

Net Income/Average Stockholder's Equity

Return on Assets (ROA)

Net Income/Average total Assets

Types of ratios

Profitability Ratios

Return on Equity

Gross Margin %

profitability, leverage, solvency, working capital

Return on equity... Gross Margin... Return on sales... asset turnover... r…

ROE... net income/avg shareholder equity... measures the return to s…

gross margin/sales... measures the percent of markup the company…

Types of ratios

profitability, leverage, solvency, working capital

Profitability Ratios

Return on equity... Gross Margin... Return on sales... asset turnover... r…

Formula for Gross Profit Ratio

prices of goods enough to cover all cos…

compares profit to costs (i.e. 50% ----…

highlights shifts in number and variety…

=(gross profit/net sales)*100

Gross Profit Ratio

Gross Profit Ratio

Gross Profit Ratio

Formula for Gross Profit Ratio

=(gross profit/net sales)*100

prices of goods enough to cover all cos…

Gross Profit Ratio

Current Ratio

Net Profit Margin

Earnings per Share (EPS)

Total Asset Turnover

Current Assets / Current Liabilities

Net Income / Net Sales

Net Income / Avg. Number of Shares Outstanding

Net Sales / Avg. Total Assets

Current Ratio

Current Assets / Current Liabilities

Net Profit Margin

Net Income / Net Sales

Current Ratio

Quick Ratio

Accts R Turnover

Days Sales in Accts R

Current Assets / Current Liabilities

(Cash + Short-Term Investments + Accts R) / Current Liabilities

Net Credit Sales / Avg Net Accts R

365 / Accts R Turnover

Current Ratio

Current Assets / Current Liabilities

Quick Ratio

(Cash + Short-Term Investments + Accts R) / Current Liabilities

Current Ratio

Debt Ratio

Inventory Turnover Ratio

Return on Net Sales

Current Assets/Current Liabilities

Total Liabilities / Total Assets

Cost of Goods Sold / Average Inventory

Net Income/Net Sales x 100%

Current Ratio

Current Assets/Current Liabilities

Debt Ratio

Total Liabilities / Total Assets

Quick Ratio

Current Ratio

Gross Margin Ratio

Return on Sales Ratio

Cash + Short Term Investments + Receivables/ Current Liabiliti…

Current Assets / Current Liabilities

Gross Margin/ Sales

Net Income/ Sales

Quick Ratio

Cash + Short Term Investments + Receivables/ Current Liabiliti…

Current Ratio

Current Assets / Current Liabilities

earnings per share

price-earnings ratio

dividend yield

return on equity

(net income-dividends on preferred stock)/ average shares of c…

stock price/earnings per share

dividends per share/stock price

net income/ average stockholders' equity

earnings per share

(net income-dividends on preferred stock)/ average shares of c…

price-earnings ratio

stock price/earnings per share

Working Capital Ratio

Current Ratio

Cash Ratio

Acid-test Ratio

Current Assets - Current Liabilities

Total Current Assets ÷ Total Current Liabilities

(Cash + Cash equivalents) ÷ Total Current Liabilities

(Cash including cash equivalents + Short-term investments + Ne…

Working Capital Ratio

Current Assets - Current Liabilities

Current Ratio

Total Current Assets ÷ Total Current Liabilities