Financial Ratios List - PDF by PastorGallo

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									                             How to Calculate Financial Ratios

Below is a list of several useful formulas for calculating financial ratios. There are four
major types of ratios. They will all prove especially helpful when developing your case

Gross profit margin:                                      Sales – Cost of good sold
Operating profit margin:                          Profits before taxes and before interest
Net profit margin:                                           Profits after taxes
Return on total assets:                                      Profits after taxes
                                                                Total assets
Return on stockholder’s equity:                             Profits after taxes
                                                         Total stockholders equity
Return on common equity:                  Profits after taxes-Preferred stock dividends
                                  Total stockholders’ equity- Par value of preferred stock
Earnings per share:                           Profits after taxes-Preferred stock dividends
                                             Number of shares of common stock outstanding

Current ratio:                                                  Current assets
                                                               Current liabilities
Quick ratio:                                               Current assets -Inventory
                                                              Current liabilities
Inventory to net working capital:                                 Inventory
                                                       Current assets -Current liabilities

Debt-to-assets ratio:                                             Total debt
                                                                  Total assets
Debt-to-equity:                                                    Total debt
                                                           Total stockholders’ equity
Long-term debt-to-equity ratio:                         Long-term debt
                                                   Total stockholders’ equity
Fixed-charge coverage:                          Profits before interest and taxes
                                                        Interest charges
Fixed-charge coverage:            Profits before taxes and interest+Lease obligations
                                       Total interest charges+Lease obligations

Inventory turnover:                                          Sales
                                                  Inventory of finished goods
Fixed assets turnover:                                       Sales
                                                          Fixed assets
Total assets turnover:                                       Sales
                                                          Total assets
Accounts receivable turnover:                         Annual credit sales
                                                      Accounts receivable
Average collection period:                            Accounts receivable
                                                      Average daily status

Dividend yield on common stock:                  Annual dividends per share
                                                Current market price per share
Prince-earnings ratio:                          Current market price per share
                                                 After tax earnings per share
Dividend payout ratio:                            Annual dividends per share
                                                  After tax earnings per share
Cash flow per share:                            After tax profits+Depreciation
                                             Number f common shares outstanding

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