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Ratio Analysis
Ratio Analysis
Ratio Analysis
ANALYSIS
1) CURRENT RATIO
2) QUICK RATIO
Quick Assets =
Current Assets –(Stock + Prepaid Expenses)
Quick Liabilities =
Current Liabilities – Bank Over draft
Absolute Quick Ratio=
Absolute Quick Assets/Current Liab.
TOTAL ASSETS =
FIXED ASSETS AND CURRENT
ASSETS
CAPITAL FIXED FIXED
GEARING = DIVIDEND+INTEREST
RATIO FUNDS FUNDS
EQUITY
SHAREHOLDERS FUNDS
FIXED DIVIDEND FUNDS=
PREFERENCE EQUITY
FIXED INTEREST FUNDS=
DEBENTURES OR ANY OTHER
FIXED INTEREST LOAN
FIXED FIXED ASSETS
___________________
ASSETS = CAPITAL EMPLOYED
RATIO
CAPITAL EMPLOYED =
SHAREHOLDERS EQUITY +
LONG TERM DEBT
INTEREST PROFIT BEFORE
COVERAGE =INTEREST & TAX
RATIO FIXED INTEREST
INTEREST =
INTEREST ON DEBENTURE OR
ANY OTHER LONG TERM LOAN
DIVIDEND PROFIT AFTER TAX
COVERAGE =
PREFERENCE DIVIDEND
RATIO
CREDITOR
= No OF DAYS IN A YEAR
VELOCITY CREDITOR TURNOVER RATIO
FIXED ASSETS SALES
TURN-OVER = FIXED ASSETS
RATIO
Operating Cost =
Cost of Goods sold + Operating
Expenses + Administration, General
Selling & Distbution Expenses
PROFIT BEFORE
RETURN ON CAPITAL INTEREST & TAX
EMPLOYED = CAPITAL EMPLOYED
NET WORTH
NUMBER OF SHARES