Ratios for exam 1

Dr Bacon's class

Current Ratio

Current Assets / Current Liabilities

CR

CA / CL

Quick Ratio (Acid test)

(Current Assets - Inventory) / Current Liabilities

QR

(CA - Inventory) / CL

Debt Ratio

Total Debt / Total Assets

DR

TD / TA

Times Interest Earned Ratio

EBIT / Interest

TIER

EBIT / I

Inventory Turnover

C.O.G.S / Inventory

IT

COGS / Inventory

Accounts Receivable Turnover

Annual Sales / Accounts Receivable

ART

Sales / AR

Average Payment Period

Accounts Payable / (Credit Purchases / 365)

APP

AP / (Ced. Purchases / 365)

Asset Turnover

Sales / Turnover

AT

Sales / Turnover

Gross Margin on Sales

(Sales - COGS) / Sales

GM

(Sales - COGS) / Sales

Profit Margin on Sales

Net Income After Tax / Sales

PM

NIAT / Sales

Return on Equity

Net income after Tax / Net worth* (common stock + Retained Earnings)

ROE

NIAT / Net Worth (Comm. Stk. + Ret. Earn.)

Return on Assets

Net Income After Tax / Total assets

ROA

NIAT / TA

Earnings per Share

Net income after tax / # common stock outstanding* (# of shares)

EPS

NIAT / # Shrs comm stk

Payout Ratio

Dividend per share / Earnings per share

PR

DPS / EPS

Dividends per Share

Payout Ratio * Earnings per Share

DPS

PR * EPS

Price to Earnings

Market price per share / Earnings per Share

PE

Price / EPS