25 Cards in this Set
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Percentage Increase
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(New Amount - Prior Amount) //// Prior Amount
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Leverage
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total assets ////
Total equity asset to equity ratio
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Efficiency
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sales /////
total assets asset turnover ratio
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Profitability
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net income ////
sales return on sales ratio
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Asset-Equity ratio
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total assets/////////
total stockholders equity --------- leverage
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asset turnover ratio
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efficiency ---------
Sales/ ///////// total assets
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return on sales
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net income/////////////
sales ------------ Profitability
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return on equity ratio
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leverage * efficiency * profitability
Net Income/ ///////////////// Total Stockholders Equity
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Return on Assets ratio
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NET INCOME////////////
TOTAL ASSETS
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WORKING CAPITAL
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CURRENT ASSETS-------
CURRENT LIABILITIES
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CURRENT RATIO
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CURRENT ASSETS/ ///////////////
CURRENT LIABILITIES
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QUICK RATIO
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In finance, the Acid-test or quick ratio or liquid ratio measures the ability of a company to use its near cash or quick assets to extinguish or retire its current liabilities immediately.
-------------------------- CASH +A/R + MARKET SECURITIES/////////////// CURRENT LIABILITIES
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TIMES INTEREST EARNED
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Times interest earned (TIE) or interest coverage ratio is a measure of a company's ability to honor its debt payments.
-------------- EARNINGS BEFORE INTEREST + TAX / ////////////////// INTEREST EXPENSE
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NUMBER OF DAYS SALES IN RECEIVABLES
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AVG. ASSETS RECEIVABLE / ///////////////
AVG DAILY SALES --------------- AVG ASSETS RECEIVABLE = BEG A/R BALANCE + END A/R BALANCE DIVIDED BY 2
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NUMBER OF SAYS SALES IN INVENTORY
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AVG INVENTORY ///////////////
AVG DAILY COST OF GOODS SOLD \...................... AVG DAILY COST OF GOODS SOLD = TOTAL COST OF GOODS SOLD////360
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CASH FLOW TO NET INCOME
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CASH FROM OPORATING ACTIVITIES //////////////////
NET INCOME
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CASH FLOW ADEQUACY
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Cash from Operating Activities///// [Cash used for Buildings, Land, Equipment, Other Fixed Assets, and Acquisitions of new Business]
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FREE CASH FLOW
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CASH FROM OPERATING ACTIVITIES ----cash from Plant, Property and equipment----------cash from Dividends
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DIVIDENT PAYOUT RATIO
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CASH DIVIDENDS////////////////
NET INCOME
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PRICE EARNINGS RATIO
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MARKET PRICE OF 1 SHARE / ///////////////
EARNINGS PER SHARE
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Average Common Shares Outstanding
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Shares Issued and Out Standing ++ New Shares ---- Treasury Shares
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Vertical Analysis
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• Shows different accounts as percentages of a total
o Ex. Income statement shows each amount as a percent of Sales • Allows you to see the percent differences between years • Shows number of cents invested in each type of account for each $1 of total
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What are Common-Size statements?
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• If an income statement only showed the % of Sales columns for 2008 and 2009, it would be referred to as a common-size income statement
• If a balance sheet only showed the % of Total columns for 2008 and 2009, it would be referred to as a common-size balance sheet • The removal of doll…
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What is Horizontal Analysis?
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• Involves calculating the dollar change and percent change for each line item on the income statement from the previous year to the current year
• From this you can determine which items helps Net Income increase faster than Sales and the line items which dragged it down
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Market price of 1 Share
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Earnings Per Share * Price Earnings Ratio
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ACC 221: CASH FLOW