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Comprehensive Financial Ratios List

The document defines and lists various financial ratios used to analyze a company's liquidity, activity, profitability, and solvency. Ratios included are the current ratio, quick ratio, cash ratio, receivables turnover ratio, days of sales outstanding, inventory turnover ratio, days of inventory on hand, gross profit margin, return on assets, debt-to-equity ratio, and interest coverage ratio. These ratios measure aspects such as a company's ability to meet short-term obligations, efficiency of operations, profit levels, and ability to repay outstanding debt.

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57 views2 pages

Comprehensive Financial Ratios List

The document defines and lists various financial ratios used to analyze a company's liquidity, activity, profitability, and solvency. Ratios included are the current ratio, quick ratio, cash ratio, receivables turnover ratio, days of sales outstanding, inventory turnover ratio, days of inventory on hand, gross profit margin, return on assets, debt-to-equity ratio, and interest coverage ratio. These ratios measure aspects such as a company's ability to meet short-term obligations, efficiency of operations, profit levels, and ability to repay outstanding debt.

Uploaded by

gnachev_4
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

FINANCIAL RATIO LIST

Liquidity

Current ratio = Current assets ÷ Current liabilities

Quick ratio = (Cash + Short-term marketable investments + Receivables) ÷ Current liabilities

Cash ratio = (Cash + Short-term marketable investments) ÷ Current liabilities

Defensive interval ratio = (Cash + Short-term marketable investments + Receivables) ÷ Daily


cash expenditures

Activity

Receivables turnover ratio = Total revenue ÷ Average receivables

Days of sales outstanding (DSO) = Number of days in period ÷ Receivables turnover ratio

Inventory turnover ratio = Cost of goods sold ÷ Average inventory

Days of inventory on hand (DOH) = Number of days in period ÷ Inventory turnover ratio

Payables turnover ratio = Purchases ÷ Average trade payables

Number of days of payables = Number of days in period ÷ Payables turnover ratio

Cash conversion cycle (net operating cycle) = DOH + DSO – Number of days of payables

Working capital turnover ratio = Total revenue ÷ Average working capital

Fixed asset turnover ratio = Total revenue ÷ Average net fixed assets

Total asset turnover ratio = Total revenue ÷ Average total asset

Profitability

RETURN ON SALE

Gross profit margin = Gross profit ÷ Total revenue

Operating profit margin = Operating profit ÷ Total revenue


Pre-tax margin = Earnings before tax but after interest ÷ Total revenue

Net profit margin = Net income ÷ Total revenue

RETURN ON INVESTMENT

Operating return on assets = Operating income ÷ Average total assets

Return on assets = Net income ÷ Average total assets

Return on equity = Net income ÷ Average shareholders’ equity

Return on total capital = Earnings before interest and taxes ÷ (Interest bearing debt +
Shareholders’ equity)

Return on common equity = (Net income – Preferred dividends) ÷ Average common


shareholders’ equity = NI ÷ E

Tax burden = Net income ÷ Earnings before taxes

Interest burden = Earnings before taxes ÷ Earnings before interest and taxes

EBIT margin = Earnings before interest and taxes ÷ Total revenue

Financial leverage ratio (equity multiplier) = Average total assets ÷ Average shareholders’
equity

Total asset turnover ratio = Total revenue ÷ Average total asset

Solvency ratios

DEBT

Debt-to-assets ratio = Total debt ÷ Total assets

Debt-to-equity ratio = Total debt ÷ Total shareholders’ equity

Debt-to-capital ratio = Total debt ÷ (Total debt + Total shareholders’ equity)

COVERAGE

Interest coverage ratio = Earnings before interest and taxes ÷ Interest payments

Fixed charge coverage ratio = (Earnings before interest and taxes + Lease payments) ÷
(Interest payments + Lease payments)

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