this word file contains formulae of various financial ratios, ideal values and interpretation... this will be very helpful for those who wants to do ratio analysis.....Full description
Financial ratio analysis for two construction companies, Gamuda Bhd, YTL Corp. based on their 2013 annual reports.
understanding of financial ratio analysisFull description
Financial performance evaluation
Accounting
The concept about various financial ratios are discussed here. TATA STEEL is the company which is taken here for analysis.Full description
One of the Best PPTs I came across regarding the Financial Ratio Analysis. A must have for all the Commerce and MBA students. It encompasses almost all the ratios that are useful along wi…Full description
An Assignment on Financial Statement (2014 & 2015) Ratio Analysis of Two Companies. The Companies Are- RAK Ceramics BD Ltd & Berger Paints BD Ltd.Full description
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Financial Statement Analysis Liquidity Ratio Asset Management Debt Management Profitability Market Value DuPont Equation Z-Score Analysis
ratio analysis
Ratios
Ratios
Ratio Analysis Formula Liquidity Ratios Location Ratio
To indicate the ability to meet currently maturing obligations
Quick Asset Current Liabilities
B.S. Asset portion B.S. Liability portion
To indicate instant debt paying ability
Inventory to Net Working Capital
Inventory (Current Assets – Current Liabilities)
B.S. Asset portion B.S. Liability & Asset portion
To indicate the cushion of excess current assets over current liabilities may be threatened by unfavorable changes in inventory
Cash Ratio
Cash + Cash Equivalents Current Liabilities
B.S. Cur. Asset B.S. Liability portion
To indicate how many current obligations can be met with cash or cash equivalents
Quick Test
Profitability Ratio Ratio
Formula
Net Profit Margin (%)
Net profit After Taxes Net Sales
Gross Profit Margin (%)
Sales – Cost of Goods Sold Net Sales
Return On Investment (%)
Earnings per Share ($) Activity Ratios
Location Income Statement Income Statement Income Statement Income Statement
Net Profit After taxes Total Assets
Income Statement Balance sheet
(Net Profit After Tax – Preferred stock Dividends) Average # Of Common Shares
(Income Statement-B.S) B.S. (sometimes)
Explanation Indicates the revenue required to earn a dollar profit after tax Indicates the profit available for non-manufacturing overhead Indicates the efficiency that management uses the companies assets Indicates the after tax earnings for the common stock shareholders
Ratio
Formula
Location
Explanation
Inventory Turnover
Net Sales Inventory
Income Statement Balance sheet
To assess the efficiency in the management of Inventory
Days Of Inventory (days)
Inventory COGS/365
Balance sheet Income Statement
To assess the efficiency in the management of Inventory
Net Working Capital Turnover
Net Sales Net Working Capital
Income Statement Balance sheet (CACL)
To assess the effectively the Net Working Capital is used to generate sales
Asset Turnover
Sales Total Assets
Income Statement Balance sheet
To assess the amount of sales generated by each asset dollar
Income Statement Balance sheet
To assess the amount of sales generated by each fixed asset dollar
Fixed Asset Turnover
Sales Fixed Assets
Average Collection Period (days)
Accounts Receivable Sales for Year/365
Balance Sheet Income Statement
To assess the efficiency in the management/collection of Accounts receivable
Accounts Receivable Turnover
Annual Credit Sales Accounts Receivable
Work sheet &/or Sub. Ledgers Balance Sheet
To assess the efficiency in the management/collection of Accounts receivable
Accounts Payable
Accounts Payable
Balance Sheet
To assess the efficiency in
Period
Purchases for year/365
Work sheet
the management/payment of A/P
Leverage Ratios Ratio
Formula
Location
Explanation
Debt to Asset Ratio (%0
Total Debt Total assets
Balance Sheet Balance Sheet
Assess the amount of borrowed funds used to finance company assets
Debt to Equity Ratio (%)
Total Debt Shareholder’s Equity
Balance Sheet Balance Sheet
Assess the funds provided by creditors versus the funds by owners
Long Term Debt to Capital Structure (%)
L –T debt Shareholder’s Equity
Balance Sheet Balance Sheet
Assess the long-term component of the capital structure
Time Interest Earned (dec.)
Profit pre tax + Interest Charges Interest Charges
Income Statement Income Statement
Indicates the ability of the company to meet its annual interest
