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Engr_111_FA09_Midterm_Formulas - ROE=(Net...

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Profitability Measures COGS Margin COGS/Sales Gross Profit Margin Gross Profit/Sales Operating Profit Margin EBIT/Sales Net Profit Margin Net Income/Sales Return on Assets (ROA) Net Income/Total Assets Return on Equity (ROE) Net Income/Total Equity Earnings per share Net Income/ # Shares Outstanding Market Value Measures Price/Earnings ratio (P/E) Price per share/Earnings per share Market-to-Book ratio Market value per share/book value per share Dividend Payout Ratio: Cash Dividends/Net Income (calculate using per share) Retention Ratio: Additions to retained earnings / Net income = 1 – payout ratio Internal Growth rate (ROA x retention ratio)/(1-(ROA x retention ratio)) Sustainable Growth rate (ROE x retention ratio)/(1- (ROE x retention ratio)) Future value interest factor = (1 + r) t r = (FV / PV) 1/t – 1 Expected Value E[V]=∑P i V i Annuity Present Value Current Ratio = CA/CL Growing Perpetuity PV=C/(r-g) Annuity Future Value Du Pont Equation
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Unformatted text preview: ROE=(Net Income/Sales)(Sales/Assets)(Assets/Total Equity) PV for a perpetuity = C / r Days Sales in Inventory=365*Inventory/COGS Annual Percentage Rate & Effective Annual Rate Internal Growth Rate=(ROA*b)(1-ROA*b) Sustainable Growth Rate=(ROE*b)(1-ROE*b) EAR = e q- 1 Future value Learning Curves FV = PV(1+r) t T(N) = T(1) x N^(logLC/log2.0) Present value PV = FV / (1+r) t After-tax return = Pre-tax return (1-T) R=r+h and (1+R) = (1+r)(1+h) ROE = NI/Sales x Sales/Total Assets x Total Assets/Total Equity r r C PV t ) 1 ( 1 1 r r C FV t 1 ) 1 ( 1 m APR 1 EAR m 1-EAR) (1 m APR m 1 1 Assets Debt EFN Sales Sales ( PM Pr ojected sales ) ( d ) Sales Sales...
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