IFM exam 2

Current ratio

Current assets / Current liabilities

Quick ratio

(Current assets – Inventories) / Current liabilities

Inventory turnover ratio

Cost of goods sold including depreciation / Inventories

DSO (Days sales outstanding)

Receivables / (Annual sales / 365)

Fixed assets turnover ratio

Sales / Net fixed assets

Total assets turnover ratio

Sales / Total assets

Debt ratio

Total debt / Total assets

Liabilities-to-assets ratio

Total liabilities / Total assets

Market debt ratio

Total debt / (Total liabilities + Market value of equity)

Debt-to-equity ratio

Total debt / Total common equity

Equity multiplier

Total assets / Common equity

Times-interest-earned (TIE) ratio

EBIT / Interest charges

EBITDA coverage ratio

(EBITDA + Lease payments) / (Interest + Principal payments + Lease payments)

Net profit margin

Net income available to common stockholders / Sales

EBIT

Sales revenues – Operating costs

EBITDA

EBIT + Depreciation + Amortization

Net cash flow

Net income + Depreciation and amortization

NOWC

Operating current assets – Operating current liabilities

Operating current assets

Cash + Accounts receivable + Inventories

Operating current liabilities

Accounts payable + Accruals

NOPAT

EBIT(1 – Tax rate)

Free cash flow (FCF)

NOPAT – Net investment in operating capital

Free cash flow (FCF)

Operating cash flow – Gross investment in operating capital

ROIC

NOPAT / Total net operating capital

Operating profitability ratio (OP)

NOPAT / Sales

Capital requirement ratio (CR)

Total net operating capital / Sales

MVA

(Shares outstanding × Stock price) – Total common equity

MVA

(Market value of stock + Market value of debt) – Total investor-supplied capital

EVA

EBIT(1 – Tax rate) – (Total net operating capital × WACC)

EVA

(Total net operating capital) × (ROIC – WACC)

Operating Profit margin

EBIT / Sales

Gross profit margin

(Sales - COGS + Depreciation) / Sales

ROA

Net income available to common stockholders / total assets

Basic earning power BEP

EBIT / Total Assets

ROA

Profit Margin x Total Asset turnover

Return on common Equity

Net income available to common stockholders / Common equity

ROE

Profit margin X Total asset turnover X Equity Multiplier

P/E ratio

Price per share / earnings per share

Price / cash flow ratio

Price per share / cash flow per share

Book value per share

Common equity / shares outstanding

Market/book ratio

Market price per share / book value per share