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BUSFIN Formulas
| Term | Definition |
|---|---|
| Current Ratio | Current Assets ÷ Current Liabilities |
| Quick Ratio | (Current Assets − Inventory) ÷ Current Liabilities |
| Inventory Turnover | COGS ÷ Average Inventory |
| Days Sales Outstanding DSO | AR ÷ (Sales ÷ 365) |
| Times Interest Earned TIE | EBIT ÷ Interest |
| Net Profit Margin | Net Income ÷ Sales |
| Return on Equity ROE | Net Income ÷ Equity |
| Return on Assets ROA | Net Income ÷ Assets |
| Price to Earnings P/E | Price ÷ EPS |
| Market-to-Book | Market Price ÷ Book Value per Share |
| Debt-to-Capital | Total Debt ÷ (Total Debt + Total Equity) |
| Total Assets Turnover | Sales ÷ Total Assets |
| Assets | Liabilities + Stockholders’ Equity |
| Net Income | Revenue − Expenses |
| Ending retained earnings | Beginning retained earnings + (Net income - Dividends) |
| Free Cash Flow (FCF) | EBIT(1 − T) + Depreciation − Capital Expenditures − Change in Net Operating Working Capital NOWC |
| Earnings Before Interest and Taxes EBIT | (Net Income ÷ (1-T)) + Interest Expense |
| Economic Value Added EVA | EBIT(1 − T) − (Total Invested Capital × Cost of Capital) |
| Market Value Added MVA | ((Current market price per share P₀) × Number of Shares) − Book Value |
| Taxable Income | Revenue − Deductible Expenses |
| Net Operating Profit After Tax NOPAT | EBIT x (1 - Tax Rate) |