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17 Cards in this Set
- Front
- Back
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Liquidity Ratios:
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Current Ratio = Current Assets/Current Liabilities
Quick Ratio = (Current Assets – Inventory)/Current Liabilities Average Collection Period = Accounts Receivable/Daily Credit Sales Accounts Receivable Turnover = Credit Sales/Accounts Receivable Inventory Turnover = COGS/Inventory |
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Efficiency Ratios:
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Total Asset Turnover (TAT) = Sales/Total Assets
Fixed Asset Turnover (FAT) = Sales/Fixed Assets Operating Income Return on Investment (OIROI) = Operating Income/Total Assets |
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Leverage Ratios:
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Debt Ratio = Total Debt/Total Assets
Times Interest Earned (TIE) = EBIT/Interest Expense |
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Profitability Ratios:
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Return on Assets (ROA) = Net Income/Total Assets
Return on Equity (ROE) = Net Income/Total Equity Dupont ROE = (Net Income/Sales) x (Sales/Total Assets) x (Total Assets/Equity) Gross Margin = Gross Profit/Sales Operating Margin = EBIT/Sales Net Profit Margin = Net Income/Sales |
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Percent of Sales Forecasting:
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New RE = Old RE + Net Income – Dividends
New RE = Old RE + [Projected Sales x Net Margin x (1-Payout Ratio)] Net Margin = Net Income/Sales Payout Ratio = 1-Plowback Ratio Plowback Ratio = 1-Payout Ratio Payout Ratio = Dividends/Net Income Plowback Ratio = ∆Retained Earnings/Net Income External Financing Needed (EFN) = Projected Total Assets – Projected Total Liabilities – Projected Owners’ Equity |
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Time Value of Money:
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Present Value of Perpetuity = Payment/Interest Rate
(Note: Interest rate is calculated as decimal #; match numerator and denominator as quarterly, semiannual, annual, etc.) Return on Perpetuity = Payment/Present Value (Note: Payment must be an ANNUAL amount when solving for the return.) |
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Bonds:
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Current Yield = Annual Coupon Payment/Current Price
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Current Ratio
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Current Assets/Current Liabilities
(Liquidity Ratio) |
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Quick Ratio
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(Current Assets-Inventory)/Current Liabilities)
(Liquidity Ratio) |
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Average Collection Period
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Accounts Receivable/Daily Credit Sales
(Liquidity Ratio) |
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Accounts Receivable Turnover
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Credit Sales/Accounts Receivable
(Liquidity Ratio) |
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Inventory Turnover
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COGS/Inventory
(Liquidity Ratio) |
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Total Asset Turnover (TAT)
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Sales/Total Assets
(Efficiency Ratio) |
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Fixed Asset Turnover (FAT)
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Sales/Fixed Assets
(Efficiency Ratio) |
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Operating income Return on Investment (OIROI)
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Operating Income/Total Assets
(Efficiency Ratio) |
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Debt Ratio
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Total Debt/Total Assets
(Leverage Ratio) |
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Times interest Earned (TIE)
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EBIT/Interest Expense
(Leverage Ratio) |
