Intro to Finance Ratios

povocifi's version from 2016-06-21 15:54

Section 1

Question Answer
Cash Coverage RatioEBIT + Depreciation / interest
Times Interest Earned RatioEBIT / Interest
Operating Cash FlowEBIT + Depreciation - Taxes
Current RatioCurrent Asses / Current liabilities
Quick RatioCurrent Assets - inventory / current liabilities
Cash Ratiocash / current liabilities
Profit MarginNet income / sales
Return on assetsnet income / assets
Return on equitynet income / equity

Section 2

Question Answer
Cash flow from assetscf from liabilities + cf from equity
Net Capital Spendingending net fixed assets - beginning net fixed assets + depreciation
Operating Cash flowEBIT + depreciation - taxes
Change in net working capitalending NWC - beginning NWC
Cash flow from assetsoperating cash flow - net capital spending - changes in NWC
Cash flow to creditorsinterest paid - net new borrowing
cash flow to stockholders dividends paid - net new equity raised

Section 3

Question Answer
Total debt ratio total liabilites / total assets
debt to equity ratiototal debt / total equity = total liability / total equity
equity multiplierasset / equity
average tax ratetax liabilty / total taxable income

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