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Unformatted text preview: Ch 14 Analyzing Financial Statements The Investment Decision Economy wide factors Industry factors Individual company factors Understanding a Companys Strategy ROE = Net Profit Margin * Asset Turnover * Financial Leverage Product Differentiation Cost Advantage Ratio and Percentage Analyses Component Percentages Tests of Profitability Return on Equity ROE Return on Assets (ROA) Financial Leverage Percentage Earnings per Share (EPS) Quality of Income Profit Margin Fixed Asset Turnover Ratio Test s of Liquidity Cash Ratio Current Ratio Quick Ratio (Acid Test) Receivable Turnover Ratio Inventory Turnover Ratio Using Ratios to Analyze the Operating Cycle Tests of Solvency Times Interest Earned Ratio Cash coverage Ratio Debt to Equity Ratio Market Tests Price/Earnings (P/E) Ratio Dividend Yield Ratio Information in an Efficient Market...
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This note was uploaded on 04/16/2011 for the course ACC 311 taught by Professor Charrier during the Fall '08 term at University of Texas at Austin.
- Fall '08