Essay on Ratio

974 Words Jun 1st, 2013 4 Pages

Formula Current Assets Current Liabilities Short term Investments Current Receivables Current Liabilities Net sales Average accounts receivable Cost of goods sold Average inventory 365 365 Net Sales Average total assets Total liabilities Total assets Total equity Total assets Total liabilities Total equity Income before interest expense and income taxes Interest Expense Net Income Net Sales Cost of goods sold Net Sales Net Income Average total assets Net income Preferred dividents Average common stockholders equity Net Sales

Measure of Short‐term debt‐paying ability (2:1 guideline) Immediate short‐term debt‐paying ability (1:1 guideline) Efficiency of collection (bigger is better)
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common share Earnings per share Annaual cash dividends per share Market price per share Analysis period amount – Base period amount Analysis Period Amount Base Period Amount Base Period Amount 100 100 Change in Cost Change in Units Sales price per unit – Total variable cost per unit Contribution margin Per Unit Sales Price Per Unit Fixed Costs Contribution Margin Per Unit Fixed Costs Contribution Margin Ratio Fixed Costs Target Pretax Income Contribution Margin Ratio Fixed Costs Target Pretax Income Contribution Margin Per Unit Expected Sales Breakeven Sales Expected Sales Beginning Inventory + Purchases – Ending Inventory

Liquidation at reported amounts Net income per common share Market value relative to earnings Cash return per common share Assess the importance of dollar changes Assesses the importance of percent changes Reveals patterns in data across successive periods Reveals changes in the relative importance of each financial statement item Measure of the cost per unit Analysis of profits priced on a per‐unit basis Percent of a units selling price that exceeds total unit variable unit cost Gives the needed units to break even Gives the needed dollars to break even Determines needed sales to achieve targeted income levels Determines the needed units to be sold to reach after‐tax goals The amount that ssales can drop before a loss occurs Guides the purchase and the

Market Prospects

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