TO EVALUATE SHORT-TERM FINANCIAL POSITION (SHORT-TERM SOLV

1. Total Current Assets

Current ration =
Total Current Liabilities

2. Total Quick Assets

Acid-test ratio or Quick ratio =
Total Current Liabilities
Total Quick Assets = Cash + Marketable Securities + Accounts Re

3. Working Capital
Working Capital to Total assets =
Total Assets
Working Capital = Current Assets - Current Liabilities

4. Cash + Marketable Securities + Cash Flow from O

Cash Flow Liquidity ratio =
Current Liabilities

5. Quick Assets
Defensive Internal ratio =
Projected Daily Operational Expense

TO EVALUATE ASSET LIQUIDITY AND MANAGEMENT EFF

1. Net credit sales or Net sales

Trade Receivable Turnover =
Average Trade Receivables (net)
Working Capital = A/R - AFDA

Average Collection 360 days

period Receivable Turnover
or or
Number of days' Accounts Receivable
sales uncollected = Net sales
360 days

2. Inventory Turnover
Cost of goods sold
Merchandise Turnover =
Average Mechandise Inventory

Cost of goods sold

Finished Goods Inventory =
Average FG Inventory

Cost of goods manufactured

Goods in process turnover =
Average Goods in process Inventory

RM used
Raw materials turnover =
Average RM Inventory

RM used
Days supply in inventory =
Average RM Inventory

3. Net Sales
Working Capital turnover =
Average Working Capital

4. Percent of each current asset Amount of each current asset item

 to total current assets = Total Current Assets

5. Cost of Sales + Operating Expenses + Income Taxes

Current assets turnover =
Averag

6. Net purchases
Payable turnover =
Average Accounts Payable

7. Operating Cycle = Average Conversion Period of Inventories +

8. Average Cash Balance

Days Cash = Cash Operating Costs
360 days

9. Free Cash Flow = Net cash from operating activities -

10. Net Sales

Investment or Asset turnover =
Average Total Investment or Total Assets

11. Sales to fixed assets Net Sales

(Plant assets turnover) = Average Fixed Assets (net)

12. Total Assets

Capital Intensity ratio =
Net Sales

TO EVALUATE LONG-TERM FINANCIAL POSITION OR STABILIT

1. Total Liabilities
Debt ratio =
Total Assets

2. Total Equity
Equity ratio =
Total Assets

3. Total Liabilities
Debt to Equity ratio =
Total Equity

4. Fixed Assets to Fixed Assets (net)

Long-term Liabilities = Total Long-term Liabilities

5. Fixed Assets to Fixed Assets (net)

Total equity = Total Equity

6. Fixed Assets to Fixed Assets (net)

Total Assets = Total Assets

7. Book value per share Ordinary shareholders' equity

of ordinary shares = No. of outstanding shares

8. Net Income before Interest and Taxes

Times interst earned =
Annual Interest Charges

9. Times preferred dividend Net Income After Taxes

requirement earned = Preferred Dividends Requirement
10. Net Income before Taxes and Fix
Times fixed charges earned =
Fixed Charges (Rent + Interest +
Sinking Fund payment befor
Sinking Fund payment before taxes =
1 - Tax rate

TO MEASURE PROFITABILITY AND RETURNS TO INVES

1. Gross Profit
Gross Profit Margin =
Net Sales

2. Operating Profit
Operating Profit Margin =
Net Sales

3. Net profit margin Net Profit

(Rate or return on net sales) = Net Sales

4. Cash Flow for operating activities

Cash Flow Margin =
Net Sales

5. Net Profit
Rate of retun on assets (ROA) =
Average Total Assets
Alternative Formula: Asset Turnover x Net Profit Margin
Net Income + [Interest expense (
If there is interest-bearing debt:
Average Total Assets

6. Net Income
Rate of return on equity =
Average Ordinary Equity
Alternative Formula: Return on Assets x Equity Multiplier
1
Equity Multiplier:
Equity Ratio

7. Net income - preference dividends requirement

Earning per share =
Average ordinary shares outstanding

8. Market Value per Share of Ordinary Shares

Price / earning ratio =
Earnings per share of Ordinary Shares

9. Dividends per share

Divident Payout =
Earnings per share

10. Annual Dividends per share

Dividend Yield =
Market Value per share of Ordinary Shares

11. Dividends Paid / Declared

Dividends per share =
Ordinary Shares Outstanding

12. Rate of return on Net Income

average current assets = Average Current Assets

13. Rate of return per Rate of return in Average current assets

turnover of current assets = Current Assets turnover
ON (SHORT-TERM SOLVENCY AND LIQUIDITY)

Current Assets - Inventories

Quick ratio =
Total Current Liabilities
Securities + Accounts Receivable

ssets - Current Liabilities

urities + Cash Flow from Operating Act

urrent Liabilities

Quick Assets
aily Operational Expenses

AND MANAGEMENT EFFICIENCY

edit sales or Net sales

Trade Receivables (net)
A/R - AFDA

* green means compute first*

Sales
Inventory Turnover =
Inventories

Net Income
Profit Margin =
Net Sales

manufactured
process Inventory

urrent asset item

ent Assets

Expenses + Income Taxes + Other Expenses (net) (excluding depreciation & amortization)
Average Current Assets

on Period of Inventories + Average Collection Period of Receivable + Days cash

* green means compute first*

rom operating activities - Cash used in investing activities and Dividends

ales
ment or Total Assets

POSITION OR STABILITY / LEVERAGE

Total Liabilities
Debt to Asset ratio =
Total Assets

nterest and Taxes Operating profit

Times interest earned =
est Charges Interest expense

After Taxes
ds Requirement
ome before Taxes and Fixed Charges
nt + Interest + Sinking Fund payment before taxes)
nking Fund payment before taxes
1 - Tax rate

AND RETURNS TO INVESTORS

erating activities
ales

nover x Net Profit Margin

ome + [Interest expense (1 - Tax rate)]
Average Total Assets

Assets x Equity Multiplier

1
Equity Ratio

dividends requirement
hares outstanding

e of Ordinary Shares
of Ordinary Shares

nds per share

e of Ordinary Shares

rage current assets

ets turnover