Financial Ratios Formulas Liquidity Ratio | __ Current Assets 1) Current Ratio = SS Current Liabilities Current Assets-Inventory 2) Quick Rati ) Quick Ratio = Crrent Liabilities Asset Utilization Ratios: Credit Sales 3) Receivables Tumover (RT) = 7 AccRec. 4) Average Collection Period (OR) Receivables Turnover In Days = "8°" __ Credit Sales/360 AccRecX 360 360 (OR) = “Creditsates O%) ~ ar Cost of Goods Sold Sal 5) Inventory Turnover (IT) = S2S*F G008s Sold (py __Sales _ Inventory Inventory Inventory x 360 60 Inve Tt In Di =— (OR) = ———————_ 6) Inventory Tumover In Days ===> (OR) = - ae 7) Fixed Assets Tumover = 8) Total Assets Turnover = Profitability Ratios: Net Profit after Taxes Net Income 9) Net Profit Margin =~" 2 TS°5 (ogy “Re Net Sales Net Sales Gross pr 10) Gross Profit Margin = (0) Gross Profit Margin = Net Profit (net income) Total Awcere (OR) Du Pont Analysis = 11) Return on Assets (Investment) = Profit Margin x Asset Turnover Net Profit (net income) Shareholders’ Equity Return on Assets(Inv. ——_ bet sees) 12) Return on Equity = (OR) Du Pont Analysis = Debt Utilization Ratios: Total Debt Shareholders’ Equity Total Debt Total Assets 13) Debt -to- Equity = 14) Debt -to- Total Assets = EBIT Iterest Expenses Income before fixed charges and taxes Fixed charges 15) Times interest earned (OR) Interest Coverage = 16) Fixed charge coverage (FCCR) =