Ratio Analysis and Reporting for Acocunting

From Fundamental Accounting Principles textbook. Liquidy and Efficiency = LE, Solvency = S, Profitability = P, Market Prospects = MP

Current ratio, LE

Current assets / Current liabilities

Acid test ratio, LE

(Cash+Short-term investment+Current receivable) / Current liabilities

Accounts receivable turnover, LE

Net Sales / Average accounts receivable, net

Inventory turnover, LE

Cost of goods sold / Average Inventory

Days’ Sales uncollected, LE

(Accounts receivable, net / Net sales) * 365

Days’ Sales in inventory, LE

(Ending inventory / Cost of goods sold) * 365

Total asset turnover, LE

Net Sales / Average total assets

Debt ratio, S

Total liabilities / Total assets

Equity ratio, S

Total equity / Total assets

Debt-to-equity ratio, S

Total Liabilities / Total Equity

Times interest earned, S

Income before interest expense and income tax expense /

Interest expense

Profit margin ratio, P

Net income / Net sales

Gross Margin ratio, P

(Net sales - Cost of goods sold) / Net Sales

Return on total assets, P

Net income / Average Total asset

Return on equity, P

Net income / Average Total Equity

Basic Earning per share, P

(Net income - Preferred dividends) /

Weighted-average common shares outstanding

Price- earnings ratio, MP

Market price per common share / Earning per share

Dividend yield, MP

Annual cash dividends per share / Market price per share