Ratio analysis - A level business
Learn
Practice Test
Spaced Repetition
Match
Flashcards1/15
There's no tags or description
Looks like no tags are added yet.
Name | Mastery | Learn | Test | Matching | Spaced |
|---|
No study sessions yet.
16 Terms
Working capital (Net current assets)
The money need to pay the day to day expense of a business
Working capital
Current assets - current liabilities
Acid test ratio
Ability to pay off current liabilities
Acid test ratio
Current Assets - Stock / Current Liabilities
Liquidity
how quickly an asset can be converted into cash
Current Ratio
The ability to pay short -term obligations
Current ratio
Current assets / current liabilities
Gearing
The degree to which a firms operations are funded by equity capital versus debt financing
Gearing
non-current liabilities/capital employed x 100
Return on capital employed (ROCE)
Operating profit / capital employed x 100
Return on capital employed (ROCE)
How profitable the capital invested is in the business
Capital employed
Long term liabilities + shareholders’ funds
Capital employed
The amount of capital used
Shareholders' funds
The amount of equity in a company , which belongs to the shareholders
shareholders' funds
total assets - total liabilities
equity
The value that would be returned to a companies shareholders if all the assets were liquidated and all the companies debts were paid off