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Financial Management Ratio Analysis

This document outlines 29 different financial ratios used for ratio analysis in financial management. These ratios can be used to analyze various aspects of a company's financial performance and health, including profitability, liquidity, leverage, asset utilization, and debt coverage. Some key ratios include gross profit ratio, net profit ratio, return on capital employed, current ratio, debt-equity ratio, and debt-to-net worth ratio.

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Amrita Gharti
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26 views

Financial Management Ratio Analysis

This document outlines 29 different financial ratios used for ratio analysis in financial management. These ratios can be used to analyze various aspects of a company's financial performance and health, including profitability, liquidity, leverage, asset utilization, and debt coverage. Some key ratios include gross profit ratio, net profit ratio, return on capital employed, current ratio, debt-equity ratio, and debt-to-net worth ratio.

Uploaded by

Amrita Gharti
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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FINANCIAL MANAGEMENT

RATIO ANALYSIS

1. Gross profit ratio = (Gross profit / Net sales) x 100


2. Net profit ratio = (Net profit / Net sales) x l00
3. Operating profit ratio = (Operating profit / Net sales) x 100
4. Expense ratios = (Individual expenses / Net sates) x 100
5. Operating (cost) ratio = (Operating cost / Net sales) x 100
6. Net profit to net worth ratio = (Net profit after interest and tax / Net worth) x 100
7. Return on capital employed (ROI) = (Net profit before interest, tax / Capital employed) x 100
8. Earning per share = net profit available for equity shareholders / Number of equity shares
9. Dividends per share = Dividend amount / Number of equity shares
10. Capital employed turnover ratio = Cost of sales / Capital employed
11. Fixed assets turnover ratio = Cost of sales or sales / Fixed assets
12. Working capital turnover ratio = Cost of sales or Net sales / Net working capital
13. Inventory turnover ratio = Cost of goods sold / Average inventory
14. Debtors (receivables) turnover ratio = Annual net credit sales / Average accounts receivable
15. Debtors (receivables) collection period = Accounts receivables / Net credit sales per day
16. Creditors turnover ratio = Net credit purchases / Average creditors
17. Average credit period = Average account payables / Net credit purchases per day
18. Current ratio = Current assets / Current liabilities
19. Quick ratio/Acid test ratio = Quick assets / Current liabilities
20. Debt Equity Ratio = Total long term debts / shareholder' funds
21. Debt to net worth = Total long term debt / Shareholder's funds
22. External-internal equity = External equity / Internal equity
23. Debt vs. funds = total long term debts / Total long term funds
24. Debt service ratio = Earnings before interest and taxes / Fixed interest charges
25. Fixed assets ratio =Net fixed assets / Long-term funds
26. Solvency (debt to total funds) ratio = Total liabilities / Total assets
27. Reserves to capital ratio = Reserves / Capital
28. Capital gearing ratio =Equity / Fixed interest hearing securities
29. Proprietary ratio = Proprietor's funds / Total assets

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