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  • Financial Ratios Formulas

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    Jawad Aadi
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    This document provides formulas for 13 common financial ratios: current ratio, quick ratio, receivable turnover, receivable turnover in days, inventory turnover, fixed assets turnover, total assets turnover, profit margin, return on investment, return on equity, debt-to-total assets, interest coverage, and fixed charges coverage. Each ratio is defined using variables like current assets, current liabilities, inventory, credit sales, accounts receivable, cost of goods sold, sales, fixed assets, total assets, net income, and interest expenses.

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    Financial Ratios Formulas(1)

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    This document provides formulas for 13 common financial ratios: current ratio, quick ratio, receivable turnover, receivable turnover in days, inventory turnover, fixed assets turnover, total assets turnover, profit margin, return on investment, return on equity, debt-to-total assets, interest coverage, and fixed charges coverage. Each ratio is defined using variables like current assets, current liabilities, inventory, credit sales, accounts receivable, cost of goods sold, sales, fixed assets, total assets, net income, and interest expenses.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    18 views1 page

    Financial Ratios Formulas

    Uploaded by

    Jawad Aadi
    This document provides formulas for 13 common financial ratios: current ratio, quick ratio, receivable turnover, receivable turnover in days, inventory turnover, fixed assets turnover, total assets turnover, profit margin, return on investment, return on equity, debt-to-total assets, interest coverage, and fixed charges coverage. Each ratio is defined using variables like current assets, current liabilities, inventory, credit sales, accounts receivable, cost of goods sold, sales, fixed assets, total assets, net income, and interest expenses.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 1

    Alyaa AlGhanmi

    Financial Ratios Formulas


    Current Assets
    1) Current Ratio =
    Current Liabilities
    Current Assets−Inventory
    2) Quick Ratio =
    Current Liabilities
    Credit Sales
    3) Receivable Turnover(RT) =
    Acc.Receivable
    365
    4) Receivable Turnover In Days =
    RT
    Cost of Goods Sold Sales
    5) Inventory Turnover (IT) = OR
    Inventory Inventory
    Sales
    6) Fixed Assets Turnover =
    Fixed Assets
    Sales
    7) Total Assets Turnover =
    Total Assets
    Net Income
    8) Profit Margin =
    Sales
    Net Income
    9) Return on Investment ( ROI ) = (OR)= Profit Margin x Asset Turnover
    Total Assets
    Net Profit Return on Assets(Inv.)
    10) Return on Equity (ROE )= (OR) Debt
    Shareholders′ Equity 1−( )
    Assets
    Total Debt
    11) Debt -To- Total Assets =
    Total Assets
    EBIT
    12) Interest Coverage =
    Interest Expenses
    Income Before Fixed Charges and Taxes
    13) Fixed Charges Coverage =
    Fixed Charges

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