RATIOS

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  • Created by: FKJOYCE
  • Created on: 27-01-15 15:15
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  • RATIOS
    • EFFICIENCY RATIOS
      • CEDITOR DAYS
        • A ratio that estimates the average period taken to settle amounts OWED BY a from to SUPPLIERS
      • DEBTORDAYS
        • A ratio that focuses on the average time taken for trade debtors to settle their accounts. PEOPLE WHO OWE THE FIRM MONEY
      • ASSET TURNOVER
        • A ratio that calculates the RELATIONSHIP BETWEEN REVENUES and the TOTAL ASSETS in a business
      • STOCK/ INENTORY TURNOVER
        • A ratio that looks at how QUICKLY STOCK IS CONVERTEDTO SALES
    • SHARE-HOLDERS' RATIOS
      • DIVIDEND PER SHARE
        • Dividend per share = total dividends paid / number of ordinary shares issued
      • DIVIDEN YEILD
        • Shows the % of the current market prices of the shares.
    • PROFITABILITY AND PERFORMANCE RATIOS
      • ROCE
        • A measure of the % return that a business EARNS FROM THE CAPITAL EMPLOYED in the business.
      • GROSS PROFIT
        • REVENUE - COST OF SALES
        • GROSS PROFIT MARGIN
          • = GROSS PROFIT / REVENUE
      • OPERATING PROFIT
        • Profit earned fro a business' entire trading before tax.
        • OPERATING PROFIT MARGIN
          • = OPERATING PROFIT / SALES (REVENUE)x 100
    • LIQUIDITY RATIOS
      • ACID TEST RATIO
        • A ratio that looks at whether a firm CAN PAY FOR CURRENT LIABILITIES with CASH.
      • CURRENT RATIO
        • A measure of liquidity that assess they ability of current assets to finance current liabilities
    • GEARING RATIO
      • A ratio that looks at the long-term financial stability and structure of a firm. It measures the proportion of assets in a business that are financed by borrowing.

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