Ibp Project

Assignment ON
R ATIO A NALYSIS
Ratio Ratio
Analysis Analysis
Ratio
Analysis
MBA (Banking & Finance) 4th Term, Session 2009-2011

Submitted ByClass Roll NumberExam Roll
NumberRomana NargusA-1462
Submitted To
$ir. Kamran Khan
IN THE NAME OF
ALLAH
THE MOST GRACIOUS & THE MOST MERCIFUL
DECLARTION
E C L A R T I O N
I declare that this project report entitled “Ratio Analysis” is original and
bonafide work of my own in the partial fulfillment of the requirements for the
award of the Degree of MASTER OF BUSINESS ADMINISTRATION
(Banking & Finance) and submitted to the Department of Business
Administration, Gomal University Dera Ismail Khan,
Khyber.Pakhton.Khwa.
The data that has been collected by me is truly authentic and contains true and
complete information.
Signature of the student
(Romana Nargus )
ACKNOWLEDGEMENT
C K N O W L E D G E M E N T
All praise to ALLAH, the most merciful, kind and beneficent,

and the source of all knowledge, wisdom within and beyond my
comprehension. He is the only God, who can help me in every
field of life. All respect and possible tributes goes to our Holy
Prophet Mohammad (SAW), who is forever guidance and
knowledge for all human beings on this earth.
I am proud to say that I am very grateful to my families whose kind

prayers and cooperation helped me at every step of my work. Special
thanks go to my formative Teacher’s for their cooperation for the sake
of our knowledge.
Romana Nargus
b r i e f c o n t e n t s
BRIEF CONTENTS
Introduction
Chapter-1
 Ratio Analysis 2
 Types of Ratio Analysis 2
 Tools Of Analysis 2
 Objectives of Analysis 3
Liquidity Ratio Chapter-
2
 Net working Capital Ratio 2
 Current Ratio
3
 Quick (Acid Test )Ratio 3
Activity Ratio
Chapter-3
 Account Receivable Turnover 2

 Average Collection Period 3
 Inventory Turn over 3
 Average Age Inventory 4
 Total assets Turnover 5
Leverage Ratio
Chapter-4
 Debt Ratio 2
 Debt Equity Ratio 3
 Time Interest Earned 4
Profitability Ratio
Chapter-5
 Gross Profit Margin 2
 Profit Margin 3
 Return On Total Assets
3
 Return On Common Equity
4
Market Value
Chapter-6
 Earning Per Share 2
 Price/Earning Ratio 3
 Book Value Per Share 2
 Dividend Per Yield 3
 Dividend Pay Out 3
 Text Reference
 Web Reference
INTRODUCTION
N T R O D U C T I O N
In this section four topics are discussed:
• Ratio Analysis
• Types or Ratio Analysis
• Cross Section Analysis
• Time Series Analysis
• Combine Analysis
• Tools of Analysis
• Objectives of Ratios Analysis
Romana Nargus MBA (Banking & Finance), 2009-2011 GU .D.I.Khan
RATIO ANALYSIS
Ratio analysis involves methods of calculating and interpreting financial ratio to analyze and
monitor the firm performances. The basic inputs to ratio analysis are the firm’s balance sheet
and income statement.
TYPES OF RATIO ANALYSIS

 Cross Sectional Analysis
Comparison of two different firms financial ratios at the same point in the times is
involves comparing the firm’s ratios to those of other firms in its industry or to
industry averages.
 Time-Series Analysis
Evaluation of the firm s financial performance over time using financial ratio analysis
means comparison to current to past performance using ratios enables analyst to
access the firm progress.
 Combined Analysis
A combined view makes it possible to access the trend in the behavior of the ratio in
the relation to the industry.
TOOLS OF ANALYSIS
1. Comparative Statement.
2. Absolute Increase/Decrease in % ages.
3. Trend Percentages.
4. Common Size Percentages.
5. Ratio Analysis.
1. COMPARATIVE STATEMENT
In this statement two or more than two years data is presented for comparison.
2. ABSOLUTE INCREASE/DECREASE
It is a type of Horizontal analysis. It gives changes in absolute data intern of Rupees amount.
It enables the analyst to point out the direction of business.
3. TREND PERCENTAGE
Page | 2
This is the second type of horizontal analysis. It is adopted to know the tendencies of
business position. In it one year is chosen as base year and item of financial statement of base
year related with other years relevant items.
4. COMMON SIZE PERCENTAGE

This method is for vertical analysis. It represents the change in percentages in relation to total
assets, total liabilities and owner equity. In this method we take total assets, liabilities and
owner equity and sales individually 100% and develop relationship with their relevant
components.
5. RATIO ANALYSIS
Ratio is mathematical relationship of one item to other items. For analysis these ratios are
compared with other year’s relevant ratios or with the ratios of other companies of the same
nature are industrial averages. Ratios are really adopted to know the liquidity, stability and
profitability position of the company.
OBJECTIVES OF RATIO ANALYSIS
Ratios is work out to analyze the following aspect of business organization

 Solvency
a) Long term
b) Short term
c) Immediate
 Stability
 Profitability
 Operational Efficiency
 Credit Standing
 Structure Analysis
 Effective utilization of Sources
 Leverage or External Financing
Page | 3
BALANCE SHEETS
OF THE HALF YEARS ENDED
(2008 – 2010)
Assets (Rupee in Thousands) Year 2008 Year 2009 Year 2010
Current Assets
Cash and balances with

treasury banks 11766925 14879230 13356055
Balances with other banks 5550148 7333002 3497054
lending to financial institutions 10172242 8392950 14444143
Account receivable 85400018 76438647 34747780
Investments 25708194 28625915 39431005
Advances 85976895 99179372 100780162
Total current Assets I39174404 158410469 171508419
Fixed assets
operating fixed Assets 3192862 3810331 5128428
deferred tax 0 0 0
other Assets 2732641 3812788 5535038
Total Assets 145099907 166033588 182171885
Liabilities
Current
Liabilities
Bills Payable 1315680 1839077 2627051
Borrowing 10562338 14964087 17553525
Deposits & other Accounts 118794690 131839283 143036707
130672 1486424
Total Current Liabilities 708 47 145099907
Non-Current
Liabilities
Sub-ordinate Loans 2999700 2998500 2997300
Liabilities against assets
Subject to finance lease 1459 0 0
tax liabilities 567217 736298 471519
other liabilities 2271393 2603113 3219796
Total Liabilities 136512477 154980358 169905898
Share
Holder’s
Equity
Share Capital 1507018 2004333 3006499
Reserves(R.E) 5862074 5814754 6948336
Inappropriate income 0 1799979 2144810
Surplus on revaluation of
assets- net of tax 1218338 1434164 166342
Total Common Equity 8587430 11053230 12265987
1450999
Total Liabilities & Owner Equity 07 166033588 182171885
Page | 4
INCOME STATEMENTS
OF THE HALF YEARS ENDED
(2008 – 2010)
(Rupee in Thousands) Year 2008 Year 2009 Year 2010

SALES
Mark-up/Return/Interest earned 8780698 12596921 15143241
COGS Mark-up/Return/Interest expensed 4278374 6977313 8685624

Provision against non-performing loans
and advances-net 638547 1128137 3920240
Provision /(Reversal) for diminution in
the value of investment-net -36555 376 1501
Bad debts Written off directly 0 0 0
3900332 4491095 2535876
Other
Income Non-mark-up/interest income
Fee, commission, and brokerage income 838561 1013660 1072868
Dividend income 51143 109326 137079
Income from dealing in foreign currencies 356218 584344 655761
Income from sale and Purchase of securities 99825 112474 2361251
Unrealized loss on revaluation of
Investments
Classified as held for trading-net 0 -2308 1728
Other Income 206819 321758 336809
5452898 6630349 7101372
Other
Expenses Non-Mark Up/Interest Expenses
Administrative Expenses 2591985 3277353 4789536
Provision against other assets-net 0 0 0
Other charges 1832 6141 12051
Extra-ordinary/unusual items 0 0 0
2593817 3283494 4801587
Gross
Profit Profit Before Taxation (EBIT) 2859081 3346855 2299785
Taxation Taxation-Current 828774 983875 98535
-Prior Years -188247 0 -233950
-Deferred 196558 113006 -245812
Net Profit Profit After Taxation 2021996 2249974 2681012
Page | 5
LIQUIDITY R ATIO
I U I D I T Y A T I O
In this section topics are:
• Liquidity Ratio
• Net Working Capital Ratio
• Current Ratio
• Quick (Acid Test) Ratio
LIQUIDITY RATIOS
Liquidity ratios measure of the amount of funds a company can quickly use to settle its debts.
 Net Working Capital Ratio

 Current Ratio
 Quick(Acid test) Ratio
 Net Working Capital Ratio

A measure of both a company's efficiency and its short-term financial health. The working
capital ratio is calculated as:
Formula = Total current assets – Total current liabilities = NWC Ratio
2010 = 171508419 – 145099907 = 26408512

2009 = 158410469 – 148642447 = 9768022
2008 = I39174404 – 130672708 = 8501696
30000000
25000000
20000000
Percentage 15000000
10000000
5000000
0
2008 2009 2010
Years
Interpretation
The analysis shows that Net Working Capital Ratio has increased in 2010 to 26408512 but it has
decreased in 2009 to 9768022, and in 2008 to 8501696.
pg. 2
 Current Ratio
It measures the firm’s ability to meet its short term obligation. The current ratio is the ratio of
current assets to current liabilities: It is expressed as follows.
Formula = Current Assets

Current Liabilities
2010 = 171508419 = 1.182%

145099907
2009 = 158410469 = 1.605%
148642447
2008 = I39174404 = 1.065%
130672708
2
1.5
Percentage 1
0.5
0
2008 2009 2010
Years
Interpretation
The analysis shows that Current Ratio has increased in 2010 to 1.182, but it has decreased to
1.605 in 2009, and in 2008 to 1.065.
 Quick(Acid-Test) Ratio
It measures ability to meet short-term cash needs more rigorously by eliminating inventory.
Formula = Current Assets - Inventory

Current Liabilities
pg. 3
2010 = 171508419 - 158152364 = 0.914%

145099907
2009 = 158410469 - 14351239 = 0.969%
148642447
2008 = I39174404 - 127407479 = 0.090%
130672708
1.2
1
0.8
Percentage 0.6
0.4
0.2
0
2008 2009 2010
Years
Interpretation
Analysis shows that Quick (Acid-Test) Ratio has decreased to 0.090 in 2008 as compared to
2010 which is 0.914. It again strengthened in 2009 to 0.969.
pg. 4
C T I V I T Y A T I O
ACTIVITY R ATIO
• Activity Ratio
• Account Receivables Turnover
• Average Collection Period
• Inventory Turnover
• Average Age of Inventory
• Total Assets Turnover
ACTIVITY RATIO
Activity ratios measure how quickly a firm converts non-cash assets to cash assets.
 Account Receivable Turnover

 Average Collection Period
 Inventory Turnover
 Average Age of Inventory
 Total Assets Turnover
It gives the number of times accounts receivables is collected during the year.
Formula = Net Credit Sales

Average Account Receivables
2010 = 15143241 = 0.435 times

34747780
2009 = 12596921 = 0.164 times
7643864
2008 = 8780698 = 0.010 times
8540001
0.5
0.4
0.3
Times
0.2
0.1
0
2008 2009 2010
Years
Pg. 2
Interpretation
Analysis shows that Account Receivable Turnover Ratio has decreased to 0.010 in 2008
as compared to 2009 which is 0.164. It again strengthened in 2010 to 0.435.
 Average Collection Period
It measures the average amount of the time that needed to collect accounts receivables.
Formula = _______365 _______

Account Receivables Turnover
2010 = ___365 = 839.0 days
0.435times
2009 = ___365 = 2225.6 days
0.164 times
2008 = ___365 = 35500 days
0.010 times
40000
35000
30000
25000
D ays 20000
15000
10000
5000
0
2008 2009 2010
Years
Interpretation
Analysis shows that Average Collection Period has decreased to 839.0 in 2010 as
compared to 2009 which is 2225.6. It again strengthened in 2008 to 35500.
 Inventory Turnover
It measures the activity or liquidity of the firm’s inventory.
Pg. 3
Formula = Cost of Goods Sold

Average Inventory
2010 = 8685624 = 0.054 times

158152364
2009 = 6977313 = 0.486 times
14351239
2008 = 4278374 = 0.033 times
127407479
0.6
0.5
0.4
D ays 0.3
0.2
0.1
0
2008 2009 2010
Years
Interpretation
Analysis shows that Inventory Turnover has decreased to 0.033 times in 2008 as
compared to 2010 which is 0.054 times. It again strengthened in 2009 to 0.468 times.
 Average Age Inventory
Average inventory is determine by the beginning and ending and dividing by 2.
Formula = ______365_______
Inventory Turnover
2010 = ___365 = 6759 Days

0.054 times
2009 = ___365 = 751 Days
0.486 times
2008 = ___365 = 11060 Days
Pg. 4
0.033 times
12000
10000
8000
D ays 6000
4000
2000
0
2008 2009 2010
Years
Interpretation
Analysis shows that Average Age Inventory has decreased to 751 days in 2009 as
compared to 2010 which is 6759 days. It again strengthened in 2008 to 11060 days.
 Total Assets Turnover
It indicates the efficiency with which the firm uses it assets to generate sales.
Formula = _____Net Sales ____

Average Total Assets
2010 = 15143241 = 0.083%

182171885
2009 = 12596921 = 0.075%
166033588
2008 = 8780698 = 0.060%
145099907
Pg. 5
0.1
0.08
0.06
Percentage
0.04
0.02
0
2008 2009 2010
Years
Interpretation
Analysis shows that Total Assets Turnover has decreased to 0.060 in 2008 as compared
to 2009 which is 0.075. It again strengthened in 2010 to 0.083.
 Current Assets Turnover
It measures ability to meet short-term cash needs more rigorously by eliminating

inventory.
Formula = _______ Sales ______

Average Current Assets
2010 = 15143241 = 0.088 times

171508419
2009 = 12596921 = 0.079 times
158410469
2008 = 8780698 = 0.063 times
I39174404
Pg. 6
0.1
0.08
0.06
Times
0.04
0.02
0
2008 2009 2010
Years
Interpretation
Analysis shows that Current Assets Turnover Ratio has decreased to 0.063 in 2008 times
as compared to 2009 which is 0.079 times. It again strengthened in 2010 to 0.088 times.
 Fixed Assets Turnover
It measures ability to meet short-term cash needs more rigorously by eliminating

inventory.
Formula = _____ Sales ______

Average Fixed Assets
2010 = 15143241 = 0.083 times

182171885
2009 = 12596921 = 0.075 times
166033588
2008 = 8780698 = 0.006 times
145099907
Pg. 7
0.1
0.08
0.06
Times
0.04
0.02
0
2008 2009 2010
Years
Interpretation
Analysis shows that Fixed Assets Turnover has decreased to 0.006 times in 2000 as
compared to 2009 which is 0.075 times. It again strengthened in 2010 to 0.083 times.
Pg. 8
E V E A R G A T I O
LEVEARG R ATIO
• Leverage/Debt Ratio
• Debt Ratio
• Debt Equity Ratio
• Time Interest Earned
LEVERAGE/DEBET/CAPTAL STRUCTURE RATIOS
Leverage/ Capital Structure/ Debt ratios measure the firm's ability to repay long-term debt.
 Debt Ratio.
 Debt/Equity Ratio.
 Time Interest Earned.
 Debit Ratio
It measures the proportion of the total assets financed by the firm’s credit.
Formula = Total Liabilities (Debt)

Total Assets
2010 = 169905898 = 0.932%

182171885
2009 = 154980358 = 0.933%
166033588
2008 = 136512477 = 0.940%
145099907
0.942
0.94
0.938
0.936
Percentage 0.934
0.932
0.93
0.928
2008 2009 2010
Year
Interpretation
Analysis shows that Debt Ratio has decreased to 0.932 in 2010 as compared to 2009 which is
0.933. It again strengthened in 2008 to 0.940.
 Debt Equity Ratio
Pg | 2
It significant measure of solvency since a high degree of debt in the capital structure may
make it difficult for the company to meet interested charges and principles payments at
maturity.
Formula = Total Liabilities

Total Stock Holder’s Equity
2010 = 145099907 = 11.82%

12265987
2009 = 148642447 = 13.44%
11053230
2008 = 130672708 = 15.21%
8587430
16
14
12
10
Percentage 8
6
4
2
0
2008 2009 2010
Year
Interpretation
Analysis shows that Debt Equity Ratio has decreased to 11.82 in 2010 as compared to 2009
which is 13.44. It strengthened in 2010 to 15.21.
 Time Interest Earned /Interest Coverage Ratio
Formula = ______ EBIT ______
Interest (Expenses)
2010 = 2299785 = 5.93 times

47676
2009 = 3346855 = 1.019 times
Pg | 3
35677
2008 = 2859081 = 0.886 times
21234
7
6
5
4
Times 3
2
1
0
2008 2009 2010
Years
Interpretation
Analysis shows that Time Interest Earned /Interest Coverage Ratio have decreased to 0.155
in 2007 as compared to 2006 which is 0.184. It again strengthened in 2008 to 2.28 while
dropped to 0.20 in 2009.
Pg | 4
R O F I T A L I T Y A T I O
PROFITABLITY R ATIO
• Profitability Ratio
• Gross Profit Margin
• Profit Margin
• Return on Total Assets
• Return on Common Equity
Pg | 1
PROFITABILTY RATIO
Profitability ratios measure the firm's use of its assets and control of its expenses to generate
an acceptable rate of return.
 Gross Profit Margin.

 Profit Margin.
 Return on Total Assets.
 Return on Common Equity.
 Gross Profit Margin
It expresses the relationship of gross profit to net sales and is expressed in terms of
percentage. This ratio is a tool that indicates the degree to which selling price of goods per
unit may decline without resulting in losses.
Formula = Gross Profit x 100

Net Sales
2010 = 2535876 x 100 = 0.167%

15143241
2009 = 4491095 x 100 = 0.356%
12596921
2008 = 3900332 x100 = 0444%
8780698
0 .5
0 .4
0 .3
P er cen ta g e
0 .2
0 .1
0
2008 2009 2010
Y ea r s
Pg | 2
Interpretation
Analysis shows that Cash Ratio has decreased to 0.155 in 2007 as compared to 2006 which is
0.184. It again strengthened in 2008 to 2.28 while dropped to 0.20 in 2009.
 (Operating) Profit Margin
This ratio establishes a relationship between cost of goods sold plus other operating expenses
and net sales. This ratio is calculated mainly to ascertain the operational efficiency of the
management in their business operations.
Formula = Cost of goods sold + operating expenses

Net sales
2010 = 8685624 + 4801587 = 0.890%

15143241
2009 = 6977313 + 3283494 = 0.814%
12596921
2008 = 4278374 + 2593817 = 0.782%
8780698
0.9
0.85
Percentage 0.8
0.75
0.7
2008 2009 2010
Years
Interpretation
Analysis shows that Operating profit Margin has decreased to 0.782 in 2008 as compared to
2009 which is 0.814. It again strengthened in 2010 to 0.890.
 Return On Total Assets
Pg | 3
It measures the overall effectiveness of management in generating profits with its available
assets also at ROI.
Formula = Earning Available for Common Stockholder’s

Total Assets
2010 = 2681012 = 0.014%

182171885
2009 = 2249974 = 0.013%
166033588
2008 = 2021996 = 0.013%
145099907
0.0142
0.014
0.0138
0.0136
Percentage 0.0134
0.0132
0.013
0.0128
0.0126
0.0124
2008 2009 2010
Years
Interpretation
Analysis shows that Return on Total Assets has increased to 0.014 in 2010. While it again
decreased in 2009 to 0.013% while dropped to 0.013% in 2008.
 Return On Total Equity
It measures the return earned on the common stock holder’s investment in the firms.
Formula = Earning Available for Common Stockholder’s

Common Stock Equity
2010 = 2681012 = 0.891%

3006499
2009 = 2249974 = 1.122%
Pg | 4
2004333
2008 = 2021996 = 1.008%
2004333
1.2
1
0.8
Percentage 0.6
0.4
0.2
0
2008 2009 2010
Years
Interpretation
Analysis shows that Return on Total Equity has decreased to 0.891% in 2010 as compared to
2008 which is 1.008%. It again strengthened in 2009 to 1.112%.
Formula = Current Assets - Inventory

Current Liabilities
2010 = 171508419 - 158152364 = 0.914%

145099907
2009 = 158410469 - 14351239 = 0.969%
148642447
2008 = I39174404 - 127407479 = 0.090%
130672708
Pg | 5
1.2
1
0.8
Percentage 0.6
0.4
0.2
0
2008 2009 2010
Years
Interpretation
Analysis shows that ART Ratio …..has decreased to 0.155 in 2007 as compared to 2006
which is 0.184. It again strengthened in 2008 to 2.28 while dropped to 0.20 in 2009.
Pg | 6
A R K E T A L U E
M ARKET VALUE
• Market Value
• Earning Per Share
• Price/Earnings Ratio
• Book Value Per Share
• Dividend Per Yield
• Dividend Pay Out
pg. 7
MARKET VALUE
Market ratios measure investor response to owning a company's stock and also the cost of
issuing stock. it relates a firm market value as erasure by its current share pries to certain
accounting value.
 Earning Per Share.

 Price/Earnings Ratio.
 Book Value Par Share.
 Dividend Yield
 Dividend Payout.
 Earning Per Share
Formula = Net Income – Proffered Dividends

Common Stock Standing
2010 = 2681012 - 0 = 0.891%

3006499
2009 = 2249974 - 0 = 1.122%
2004333
2008 = 2021996 - 0 = 1.341%
1507018
1.6
1.4
1.2
1
percentage 0.8
0.6
0.4
0.2
0
2008 2009 2010
year
Interpretation
Analysis shows that Cash Ratio has decreased to 0.891% in 2010 as compared to 2009 which
is 1.112%. It again strengthened in 2008 to 1.341%.
pg. 8
 Pries /Earning Ratio
It relates earnings per common share to the market price at which the stock trades, expressing
the “multiple” that the stock market places on a firm’s earnings.
Formula = Market Price Per Share

Earning Per Share
2010 = 182171885 = 59.43%

3006499
2009 = 166033588 = 82.83%
2004333
2008 = 145099907 = 96.28%
1507018
120
100
80
Percentage 60
40
20
0
2008 2009 2010
Year s
Interpretation
Analysis shows that Price Earning Ratio has decreased to 0.155 in 2007 as compared to 2006
which is 0.184. It again strengthened in 2008 to 2.28 while dropped to 0.20 in 2009.
 Dividend Yield
It shows the relationship between cash dividends and market price.
Formula = Divided Per Shares

Market Price Per Share
2010 = 3370000 = 60.47%
pg. 9
5573149
2009 = 2694106 = 69.06%
3901279
2008 = 1638357 = 54.13%
3026550
10000000
9500000
9000000
Percentage
8500000
8000000
7500000
2008 2009 2010
Years
Interpretation
Analysis shows that Dividend Yield has decreased to 54.13% in 2008 as compared to 2010
which is 60.47%. It again strengthened in 2009 to 69.06%.
 Dividend Payout
It determined by the formula cash dividends per share divided by earnings per share.
Formula = Dividend per Shares

Earning Per Share
2010 = 3370000 = 60.47%

5573149
2009 = 2694106 = 69.06%
3901279
2008 = 1638357 = 54.13%
3026550
pg. 10
10 0 00 000
95 00 0 00
90 00 0 00
Percentage
85 00 0 00
80 00 0 00
75 00 0 00
2 00 8 2 00 9 2 0 10
Years
Interpretation
Analysis shows that Dividend Payout has decreased to 54.13% in 2008 as compared to 2010
which is 60.47%. It again strengthened in 2009 to 69.06%.
Text References
∗ Managerial Finance by JAE K. SHIM, JOEL g. SIEGEL.
∗ Principle of Managerial Finance 11th Edition by Lawrence J.Gitman.
∗ Askari Bank Quarterly Report March of (2010) of ACBL.
Web References
 www.google.com
 www.docstoc.com
 www.scribd.com/shanza malik
pg. 11

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Assignment ON

MBA (Banking & Finance) 4th Term, Session 2009-2011

award of the Degree of MASTER OF BUSINESS ADMINISTRATION

(Banking & Finance) and submitted to the Department of Business

Administration, Gomal University Dera Ismail Khan,

Signature of the student

All praise to ALLAH, the most merciful, kind and beneficent,

I am proud to say that I am very grateful to my families whose kind

 Account Receivable Turnover 2

In this section four topics are discussed:

TYPES OF RATIO ANALYSIS

4. COMMON SIZE PERCENTAGE

OBJECTIVES OF RATIO ANALYSIS

Ratios is work out to analyze the following aspect of business organization

Cash and balances with

(Rupee in Thousands) Year 2008 Year 2009 Year 2010

COGS Mark-up/Return/Interest expensed 4278374 6977313 8685624

Net Profit Profit After Taxation 2021996 2249974 2681012

In this section topics are:

 Net Working Capital Ratio

 Net Working Capital Ratio

Formula = Total current assets – Total current liabilities = NWC Ratio

2010 = 171508419 – 145099907 = 26408512

Formula = Current Assets

2010 = 171508419 = 1.182%

Formula = Current Assets - Inventory

2010 = 171508419 - 158152364 = 0.914%

 Account Receivable Turnover

 Account Receivable Turnover

Formula = Net Credit Sales

2010 = 15143241 = 0.435 times

 Average Collection Period

Formula = _______365 _______

It measures the activity or liquidity of the firm’s inventory.

Formula = Cost of Goods Sold

2010 = 8685624 = 0.054 times

 Average Age Inventory

Average inventory is determine by the beginning and ending and dividing by 2.

2010 = ___365 = 6759 Days

 Total Assets Turnover

Formula = _____Net Sales ____

2010 = 15143241 = 0.083%

 Current Assets Turnover

It measures ability to meet short-term cash needs more rigorously by eliminating

Formula = _______ Sales ______

2010 = 15143241 = 0.088 times

 Fixed Assets Turnover

It measures ability to meet short-term cash needs more rigorously by eliminating

Formula = _____ Sales ______

2010 = 15143241 = 0.083 times

LEVERAGE/DEBET/CAPTAL STRUCTURE RATIOS

Formula = Total Liabilities (Debt)

2010 = 169905898 = 0.932%

 Debt Equity Ratio

Formula = Total Liabilities

2010 = 145099907 = 11.82%

 Time Interest Earned /Interest Coverage Ratio

Formula = ______ EBIT ______

2010 = 2299785 = 5.93 times

 Gross Profit Margin.

 Gross Profit Margin

Formula = Gross Profit x 100

2010 = 2535876 x 100 = 0.167%

Formula = _365 _

Formula = _Net Sales

Formula = _ Sales

Formula = _ Sales __

Formula = EBIT