Download financial formulas cheat sheet and more Cheat Sheet Finance in PDF only on Docsity! Common Financial & Accounting Ratios & Formulas Cheat Sheet by David Pollack (Davidpol) via cheatography.com/2754/cs/4538/ Introd uction Accounting ratios are widely used tools of financial analysis. If properly analyzed, they help identify areas on the financial statement needing further analysis. A ratio is a mathem atical relation between two quantities expressed as a percen tage, a rate or propor tion. Short Term Solvency or Liquidity Ratios Current Ratio = Current Assets / Current Liabil ities Quick Ratio = (Current Assets – Inventory) / Current Liabil ities Cash Ratio = Cash / Current Liabil ities Net Working Capital = Net Working Capital / Total Assets Internal Measure = Current Assets / Average Daily Operating Costs Perc entage of Debt to Asset Formula = Long Term Liabil ities ⁄ Total Assets x 100% Debt to Equity Ratio Formula = Total Liabil ities ⁄ Total Equity Long Term Solvency or Financial Leverage Ratios Total Debt Ratio = (Total Assets – Total Equity) / Total Assets Debt to Equity Ratio = Total Debt / Total Equity Equity Multip lier = Total Assets / Total Equity Long Term Debt Ratio = Long Term Debt / (Long Term Debt + Total Equity) Times Interest Earned = Earnings before Interest & Taxes / Interest Cash Coverage Ratio = (Earnings before Interest & Taxes + Deprec iation) / Interest Asset Use or Turnover Ratios Inve ntory Turnover = Cost of Goods Sold / Inventory Days’ Sales in Invent ory = 365 days / Inventory Turnover Rece ivables Turnover = Sales / Accounts Receivable Days’ Sales in Receiv ables = 365 days / Receiv ables Turnover Net Working Capital (NWC) Turnover = Sales / Net Working Capital Fixed Asset Turnover = Sales / Net Fixed Assets Total Asset Turnover = Sales / Total Assets Profit ability Ratios Profit Margin = Net Income / Sales Return on Assets (ROA) = Net Income / Total Assets Return on Equity (ROE) = Net Income / Total Equity ROE = (Net Income / Sales) x (Sales / Assets) x (Assets / Equity) Market Value Ratios Price to Earnings Ratio = Price per Share / Earnings per Share Mark et- to-Book Ratio = Market Value per Share / Book Value per Share Cash Flow Ratios Cash Flow Solvency Ratio Formula = Actual Cash Flow from Operations ⁄ Total Liabil ities Cash Flow Margin Ratio Formula = Actual Cash Flow from Operations ⁄ Revenues from Sales Cash flow ROA Ratio Formula = Actual Cash Flow from Operations ⁄ Average Total Assets By David Pollack (Davidpol) cheatography.com/davidpol/ www.adldata.com Published 3rd July, 2015. Last updated 3rd July, 2015. Page 1 of 1. Sponsored by Readability-Score.com Measure your website readability! https://readability-score.com
