~finance

introduction to finance:

chapter 3

types of ratio:

1. liquidity ratio: crrent ratio,ntwrkg capital,quick rati0
2. activity/efficency ratio: invntory turnover,averge cllction period,averge pymnt priod
3. debt ratio: debt ratio,times interest earned,fixed pymnt cvrge ratio
4. profitability ratio: gross profit mrgin,net profit mrgin,opertg profit mrgin,return on asset,return on equity

formula:

::current ratio:crrent asset divide crrent liability

::netwrkg cpital:crrent asset minus crrent liability

::quick ratio: (crrent asset-inventory) divide crrent liability

::invntory trnover:sales divide invntory

::average cllction period: (account receivable divide sales) x 360

::average pymnt period: (accnt pyable divide sales) x 360

::debt ratio: total liabilty divide total asset

::times intersrt earned :EBIT divide intrest expense

::fixed pymnt cvrage ratio: EBIT plus lease pymnt

::gross profit margin: gross profit divide sales

::net profit margin: net profit after tax divide sales

::operating profit margin:oprtg profit divide sales

::RETURN ON ASSET: net profit after tax divide total asset

::RETURN ON EQUITY:net profit afte tax divide total share's holder equity

*net profit after tax = net income

*COGS = cos of good sold

*EBT = earned b4 tax

*EBIT = erned b4 interest and tax

erghhhh.!!