Midterm 1 Formulas to be Memorized

Midterm 1 Formulas to be Memorized - Profit Margin = PM =...

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Formulas to be Memorized Definition of Variables: (These definitions will NOT appear on the sheet attached to the exam.) A = Assets = Total Assets Current Assets = CA Current Liabilities = CL E = Equity = Total Equity D = Debt = Total Debt = L = Liabilities = Total Liabilities LTD = Long-Term Debt NI = Net Income b = Plowback ratio Net Working Capital = NWC = CA – CL Current Ratio = CA/CL Quick Ratio = (CA – Inventory)/CL Cash Ratio = Cash/CL Debt-Equity ratio = D/E (or L/E) ROE = NI/E ROA = NI/A Equity Multiplier = A/E = 1 + D/E Asset Turnover = AT = Sales/A
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Unformatted text preview: Profit Margin = PM = NI/Sales PM = 1 Sum of Expense-to-Sales Ratios AT = Sum of Sales to Assets Ratios Plowback or Retention Ratio = b = RE/NI Dividend Ratio = Div/NI = 1 b Earnings per Share = EPS = NI/Shares Dividends per Share = DPS = Dividends/Shares P/E = Price per Share/EPS Book value per share = Book Value of Equity/ Shares Book-to-Market = B/M = Book value of equity per share / Market value of equity per share Market-to-book = Market value of equity per share / Book value of equity per share...
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