FIN3403 Formulas

Current Ratio

Current assets/Current liabilities

Quick (Acid Test) Ratio

(Current Assets - Inventory) / Current Liabilities

Days Sales Outstanding (DSO)

Accounts Receivable/Average Credit Sales per Day

Total Asset Turnover (TAT)

Sales/Total Assets

Basic Earning Power (BEP)

EBIT/Total Assets

Inventory Turnover

Sales/Inventory

Fixed Asset Turnover

Sales/Net Fixed Assets

Account Receivables Turnover

Sales/Account Receivables

Times Interest Earned (TIE)

EBIT/Total Interest Expense

EBITDA Coverage

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

Return on Assets (ROA)

Net Income/Total Assets

Return on Equity (ROE)

Net Income/Common Equity

Return on Invested Capital (ROIC)

NOPAT/Total Capital

Profit Margin

Net Income/Sales

Operating Profit Margin

EBIT/Sales

Earnings Per Share (EPS)

Net Income/Shares Outstanding

Price/Earnings Ratio (P/E)

Price per Share/Earnings per Share or P/EPS

Book Value Per Share

Common Equity/Shares Outstanding

Debt-to-Capital Ratio

Total Debt / (Total Equity + Total Debt)

Debt Ratio

Total Debt/Total Assets

Equity Multiplier (EM)

Total Assets/Common Equity

Debt-to-Equity Ratio (D/E)

Total Debt/Total Equity

Debt to-Equity Ratio

Equity Multiplier (EM) - 1

Debt Ratio

1-(1/Equity Multiplier)

ROE lever

unleveragede (ROA) + levered effect + tax shelter effect

Levered Effect

(unlevered - cost of debt) d/e

Tax shelter effeect

[Cost of debt - cost of debt(1-tax rate)] d/e

FCF

NOPAT - Change NOWC - Change NFA

NOPAT

EBIT(1-T)

Change NOWC

Change COA - Change COL

Change NFA

Change GFA - Change Acc. Depreciation

WACC

(wd)(rd)(1-T) + (wp)(rp) + (we)(re)

EV

FCF/ (WACC -g)

EVA

NOPAT - (IC)(WACC)

MVA

EVA/ (WACC -g)

MVE (conceputal)

Book Value + MVA

MVE (formula)

Net income / rs

NCF

NI + Deprec.

OCF

NOPAT + Deprec.

rs

rf + (rm-rf)(beta)

Value of Annuity Due

Value of Ordinary Annuity x (1 + i)

Eff. %

(1+ (inom/M))^P - 1