ACCT 9-10 Ratios and Income Statement

ACCT 9-10 Ratios and Income Statement - 1) Ratio Analysis:...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
1) Ratio Analysis: a) Liquidity ratios b) Solvency Rations c) Profitability ratios d) Liquidity ability to survive in the short term i) Liquidity ratios: (1) Working capital = current assets – current liabilities (2) Current ratio = current assets / current liabilities ii) Solvency ability to survive over a long period of time (1) Solvency Ratios: (a) Debt to total asset ratio = (i) Total Debt (current and noncurrent liabilities) / Total assets (b) Free Cash Flow = cash provided by operating activities – capital expenditures – cash dividends paid iii) Profitability operating success of a company (1) Profitability ratio: (a) Earnings per share (EPS) = (i) (net income – preferred stock dividends) / average common shares outstanding 1. Ave. common shares outstanding = a. (last years ending shares + this years ending share) / 2 (ii) Higher value = improved performance 2) Primary accounting standard setting body in the U.S. a)
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/16/2008 for the course BCOR 2000 taught by Professor Brush during the Fall '07 term at Colorado.

Page1 / 2

ACCT 9-10 Ratios and Income Statement - 1) Ratio Analysis:...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online