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Ratios

  1. Dividend Yield
    • Dividend per share/Market value per share
    • Investment profitability
  2. Price-earning Ratio
    • Market value per sh c/s / EPS
    • Indication of relative value of stock risk
  3. Dividend payout
    • Dividends per share / EPS
    • %profit paid out to owners-
    • % retained for internal finance of growth
  4. E.P.S.
    • Net Income Available for c/s / Av. No shares C/S
    • Earning per unit of ownership
    • Dividend potential
  5. Times fixed charges earned
    • Net Income before Interest and Taxes / Interest + Preferred Dividends
    • Operating Risk
  6. Times Interest Earned
    • Net Income Before Interest and Taxes / Interest Expense
    • Protection of Creditors
  7. Book Value per share
    • Common Stock Equity / No. Shares C/S
    • CSE=TSE-Liquidating value P/S
    • Cumulative dividends P/S
  8. Equity to Total Assets
    (Equity Ratio)
    • Owners Equity / Total Assets
    • % equity financing
    • Protection of Creditors
  9. Debt-Equity
    • Debt / Equity
    • Relative Debt Funds
    • Financial Structure
  10. Return on Stockholders Equity
    • Net Income / Stockholders Equity
    • Earning Power per dollar of owners investment
  11. Return of Investment
    (ROI)
    • Net Income / Total Assets
    • Earning power of Business
    • Profitability-measure of management performance
  12. Profit Margin
    (Return on Sales)
    • Net Income / Net Sales
    • Profit margin per dollar of Sales
  13. Asset Turnover
    • Net Sales / Total Assets
    • Efficiency of Resource utilization
  14. Days supply in inventory
    • 365 / Inv Turnover
    • Efficiency inv. mgmt
    • Over-under-stocking
  15. Inventory Turnover
    • Cost of Goods Sold / Av. Inv
    • Liquidity of Inventory and inventory efficiency
  16. No of Days sales in Receivables
    or
    Av. Collection Period
    • Av. Rec (Net) / Daily Cr Sales
    • 365 / Rec. Turnover
    • No. of days to collect receivables
    • Efficiency of collections
  17. Receivables turnover
    • Net Credit sales / Av. Rec (net)
    • Liquidity of Receivables
    • Efficiency and collection period
  18. Quick Ratio
    (Acid Test)
    • C + m/s + Rec / clcl
    • Or
    • CA-Inv/clcl
    • Degree of immediate liquidity
  19. Current Ratio
    • Current Assets / Current Liabilities
    • Primary meansure liquidity
    • Able to meet current obligations
Author
katdunn8956
ID
100019
Card Set
Ratios
Description
Ratios for Auditing portion of CPA exam
Updated

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