Glossary of Fin Acc: chpt 13: financial Statement Analysis
Other Decks By This User
- Horizontal Analysis
- A comparison of financial statement items over a period of time.
- Vertical Analysis
- A comparison of various financial statement items within a single period with the use of common-size statements.
- The nearness to cash of the assets and liabilities.
- Current Ratio
- current assets / current liabilities
- Gross Profit Ratio
- Gross Profit / Net Sales
- Acid (quick)test Ratio
- cash + marketable securities + current receivables / Current Liabilities
- Inventory Turnover Ratio
- Cost of goods sold / average inventory
- Number of days sales in inventory
- 360* / inventory turnover
*# of days in a period
- Accounts Receivable Turnover Ratio
- Net Credit Sales / Average Accounts Receivable
- Number of days sales in receivable
- 360 / accounts receivable turnover
- The ability of a company to remain in business over the long term.
- Times interest earned
- net income + interest expense + income tax expense / interest expense
- Debt to Equity Ratio
- Total Liabilities / Total Stockholders Equity
- Debt to Assets Ratio
- total liabilities / total assets
*smaller the ratio the better
- How well management is using company resources to earn a return on the funds invested by various groups.
- Profit Margin on Sales Ratio
- Net Income / Net Sales
- Return on Assets
- Net income + interest expense, net of tax (1-.?) / average total assets
- Return on Stockholders Equity
- Net income - preferred dividends / average common stockholders equity
You must Login or Register to add cards