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Financial Ratios

This document lists various types of cash flow, profitability, efficiency, solvency, and liquidity ratios used to analyze the financial performance and position of a company. It includes cash ratios like cash realization ratio and interest coverage ratio. Profitability ratios include profit margin, gross profit ratio, return on assets, and return on equity. Efficiency ratios listed are asset turnover, fixed asset turnover, and inventory turnover. Solvency ratios include debt-equity ratio and long-term debt ratio. Liquidity ratios include current ratio and quick ratio.

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Rajdeep Banerjee
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89 views

Financial Ratios

This document lists various types of cash flow, profitability, efficiency, solvency, and liquidity ratios used to analyze the financial performance and position of a company. It includes cash ratios like cash realization ratio and interest coverage ratio. Profitability ratios include profit margin, gross profit ratio, return on assets, and return on equity. Efficiency ratios listed are asset turnover, fixed asset turnover, and inventory turnover. Solvency ratios include debt-equity ratio and long-term debt ratio. Liquidity ratios include current ratio and quick ratio.

Uploaded by

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

Cash Realisation Ratio = CFO/EAT


Interest Coverage Ratio = CFO or EBIT/Interst Paid
Asset Efficiency Ratio = CFO/Total Operating Assets Total Operating Assets = Cash + TR + inventory plus assets
Capital Asset Ratio = (CFO + Cash inflows from asset disposal)/Cash outflow from asset acquisition
Credit Worthiness Ratio = CFO/Total Debt
Cash Flow Adequacy Ratio = (3 year sum of CFO)/(3 year sum of CAPEX, inventory addition and dividends)
Cash Re-investment Ratio = CFO/Investment in gross PPE and in other assets, investment in NWC
Current Liability Coverage Ratio = CFO/ Current Liabilities
Long term Debt Coverage Ratio = CFO/ Long term Debt
External Financing Ratio = CFF/CFO
Cash Generating Power Ratio = CFO/(CFO + CFI + CFF)
Operating Cash Margin = CFO / Sales or EBITDA
Cash flow per share = (CFO - Preference Dividends)/Number of Equity shares
Debt Service Coverage Ratio (DSCR) = CFO / (Interest paid + Principal Amount)

Profitabiliy Ratios
Profit Margin (or Net Profit Ratio) = EAT/Sales
Gross Profit Ratio = (Sales - COGS)/Sales
Return on Assets = EAT/Total Assets
Return on Equity = EAT / Equity
Payout Ratio = Dividend/EAT
Earnings per Share = EAT / No. of Shares

Efficiency Ratios
Asset Turnover Ratio = Sales/Total Assets
Fixed Asset Turnover = Sales/Average Fixed Assets
Current asset Turnover = Sales/avearge Current Assets
Inventory Turnover Ratio = Sales or COGS/ Average Inventory
Debtors Turnover ratio = Sales/ Average Debtors or Accounts Recievable
DSO or Debtor's Age = 365 / Debtor's Turnover Ratio
Inventory Holding Period = 365/ Inventory Turnover Ratio
Length of Operating Cycle (Gross) = DSO + Inventory Holding Period
Recievable Turnover Ratio = Sales / Average Recievables

Solvency Ratios
Debt-Equity Ratio = Total Debt/Equity
Long Term Debt Ratio = Long term Debt / Equity
Equity Multiplier = Total Assets / Equity
Liability - Equity Ratio = Total Liabilities / Equity

Liquidity Ratios
Current Ratio = Current Asset / Current Liability
Quick Ratio = Quick Assets / Current Liability Quick Assets = Current Assets - Inve
Cash/Current Liability
Cash Coverage = Cash / Average Daily Expense Average Daily Cash Expense = (Cash
Deferred Income taxes arise because of differences in acounting income and taxable income (cuz of different methods of c
Thus, these are the amounts that maybe deductible in the FUTURE hence 'deferred'.
On a company's balance sheet, this amount is shown separately on Assets and Liablilities as their addition is not allowed a
If you have to pay lesser tax in the future, ASSET
If you have to pay more tax in the future, LIABILITY

Goodwill- Non-Current Asset, you may more than fair value because of intangible assets associated with purchase

Unearned Revenue - Liability, payment received but work not done for it

Commitments - Liability, you promise to do something in the future

Contingencies - something may go wrong, so appropriate amount is kept ready as a liability

Other Comprehensive Income (OCI) - Gains or losses that are not reflected on the Income statement. Sent directly to Reta

Notes to B/S - 3 Types. Significant accounting policies. Direct info. Indirect info
(should be >1)

TR + inventory plus assets

(should be 2:1)

ets = Current Assets - Inventory - Prepaid Expenses

Daily Cash Expense = (Cash Expense - Non Cash Expense) / 365


z of different methods of calculating non-cash expenses such as depreciation)

r addition is not allowed as they measure different aspects.

ted with purchase

ment. Sent directly to Retained earnings under Equity on B/S. Eg - loss on investment

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