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Ratio analysis - Coggle Diagram
Ratio analysis
Profitability ratios
Return on sales (ROS) (ebit/sales) x 100
Asset utilisation (AUR) sales/capital employed
Return on capital employed (ROCE) net operating income/capital employed)x100
Capital employed = shareholders funds + long term debt.
Liquidity
Current ratio =current asset / current labilities
Quick ratio = (current assets-inventory)/current liabilities
Working capital = current assets - current liabilities
Solvency
Leverage = (short-term + long-term debt)/shareholders funds
Gearing = (short-term debt + long-term debt)/(short-term debt + long-term debt + shareholders funds) x 100
Capital employed = shareholders funds + long-term liabilities
Operating efficiency
Creditors days = (creditors/COGS) x 365
Debtors days = (debtors/sales) x 365 days
Stock days = (stock/COGS) x 365
Investments
Return on equity = ROE (net profit for the finance year/shareholders funds) x 100
Payout = (dividends/profit for the year) x 100
Interest cover = EBIT/interest expanse
Price/Earnings = Market price/ earnings per share