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FINA
Business Finace
| Question | Answer |
|---|---|
| What is Current Ratio? | Measures Short Term Liquidity CR=Curr.Assets/Current Liabilities (times) |
| What is Quick Ratio? | QR=CA/CL (times) |
| What is Cash Ratio? | Cash Ratio=Cash/Current Liabilities (times) |
| What is Total Debt Ratio? | Total Debt Ratio=Current Assets-Total Equity/Total Assets (times) |
| What is Debt Equity Ratio? | Debt Equity Ratio=Total Debt/Total Equity |
| What is the Equity Multiplier? | Equity Multiplier=Total Assets/Total Equity |
| What is Times Interest Earned Ratio? | Times Interest Earned Ratio=EBIT/Interest. |
| What is cash coverage ratio? | Cash Coverage Ratio=EBIT+Depreciation/Interest |
| What is inventory Turnover? | Inv. Turnover=COGS/Inv. |
| Days Sales in inventory | Days Sales in Inv.=365/inv. Turn. |
| Recievables Turnover | RT=Sales/Acc. Recievables |
| Days in Recievabls | Days In Recievables=365/Recievables Turn. |
| Ruturn on equity | ROE=Net Income/Total Equity |
| Dupont Tells us ROE is affected by which three things? | 1. Operating Efficiency (Profit Margin) 2. Asset Use Efficiency ( Total Asset Turn) 3. Financial Leverage (Equity Multiplier) |
| Retention Ratio? | R.R= Net Income-Div./ Net income |
| Return on Assets? | ROA=Net Income/Total Assets. (measure of profit per dollar of assets. |
| Earnings Per Share? | EPS=Net Income/Shares outstanding |
| Price Earnings Ratio? | PER=Price per share/earnings per share. |
| What are the two Internal Uses of financial statements? | 1.Performance Eva 2. Future Planning |
| What are four External Uses of Financial Statements | 1.Short & Long term creditors 2. Evaluate Suppliers and vice versa 3. Evaluate Competitors 4. Potential Aquisitions. |