5-Accounting & Finance 2.ppt

5-Accounting & Finance 2.ppt - BMGT 110...

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BMGT 110 Introduction to Business Management Accounting & Finance 2
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Key Financial Ratios Profitability ratios Profit margin = net income/sales Return on assets = net income/assets Return on equity = net income/equity Asset utilization ratios Receivables turnover = sales/receivables Inventory turnover = sales/inventory Total asset turnover = sales/total assets
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Liquidity ratios Current ratio = current assets/current liabilities Quick ratio = current assets-inventory/current liabilities Debt utilization ratios Debt to total assets = total debt/total assets Times interest earned = income before interest and taxes/interest expense Key Financial Ratios
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Per Share Data Dividends per share = total dividends/number of shares outstanding
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You Choose
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Financial Management Managing the assets, liabilities and owner’s equity Goals Increase return on assets Minimize cost of capital Maximize owners’ equity
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Managing Current Assets (working capital) Current assets
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5-Accounting & Finance 2.ppt - BMGT 110...

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