SUMMARY OF RATIOS

SUMMARY OF RATIOS - Fixed Charge Coverage Ratio = EBIT +...

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SUMMARY OF RATIOS Liquidity Ratios Show the relationship of firm’s cash and other current assets to current liabilities. Provide indication of firm’s ability to meet its current obligations. Current Ratio = Current Assets Current Liabilities Quick (Acid Test) Ratio = Current Assets-Inventories Current Liabilities Asset Management Ratios Measures how effectively firm is managing its assets Inventory Turnover Ratio = Cost of Goods Sold Inventories Days Sales Outstanding (DSO) = Receivables Annual sales 360 Fixed Assets Turnover Ratio = Sales Net Fixed Assets Total Assets Turnover = Sales Total Assets Debt Management Ratios Measures the use of debt financing. Indication of leverage. Debt Ratio = Total Debt Total Assets
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Times Interest Earned Ratio = EBIT Interest Charges
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Unformatted text preview: Fixed Charge Coverage Ratio = EBIT + Lease Payments Interest Charges +Lease Payments + Sinking fund payments (1- tax rate) Profitability Ratios Effect of liquidity, asset management and debt management on operating results. Net Profit Margin = Net Income Sales Return on Assets (ROA) = Net Income Total Assets Return on Common Equity (ROE) = Net income available to common stockholders Number of common shares O/S Market Value Ratios Relate stock price to its earnings and book value per share. What investors think of companys future prospects based on past performance. Price/Earnings Ratio = Market price per share Earnings per share Price/Book Ratio = Market price per share Book value per share...
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This note was uploaded on 04/12/2008 for the course BUS 320 taught by Professor Sloan during the Fall '08 term at N.C. State.

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SUMMARY OF RATIOS - Fixed Charge Coverage Ratio = EBIT +...

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