Ratio analysis

Essay specific features

 

Issue:

Business

 

Written by:

Charles K

 

Date added:

September 14, 2010

 

Level:

University

 

Grade:

A

 

No of pages / words:

2 / 293

 

Was viewed:

5524 times

 

Rating of current essay:

 
Essay content:

profit figures. Here are some of the most important ratios used in business: Profit margin ratios: Gross profit % = (Gross profit / Sales) x 100% Operating profit % = (Operating profit / Sales) x 100% Gearing ratio: Gearing ratio = (Preference share debt - cash at bank) / Equity Management ratios: Return on ordinary shareholders funds = (Net profit before tax / Average Equity) x 100% Return on capital employed (ROCE) = (Operating profit / Average capital employed) x 100% Investment ratios: Earnings yield = (Earnings per share / Share Price) x 100% Earnings per share = Net profit (after tax and preference divi) / Number of ordinary shares Price/earnings ratio = Market price of share / Earnings per share Dividend yield = (Dividend per share / Market price of share) x 100% Dividend cover = Net profit / Dividends Interest cover = Profit (before interest and tax) / Intrest payable for year Solvency ratios: Working capital (current ratio) = Current assets / Current Liabilities Acid or quick test ratio = (Current assets - stock) / Current Liabilities Debtor days and creditor days: Debtor days = (Average trade debtors / Credit sales) x 365 days Creditor days = (Average trade creditors / Credit Purchases) x 365 days
displayed 300 characters

Custom written essay

All essays are written from scratch by professional writers according to your instructions and delivered to your email on time. Prices start from $10.99/page

Order custom paper

Full essays database

You get access to all the essays and can view as many of them as you like for as little as $28.95/month

Buy database access

Order custom writing paper now!

  • Your research paper is written
    by certified writers
  • Your requirements and targets are
    always met
  • You are able to control the progress
    of your writing assignment
  • You get a chance to become an
    excellent student!

Get a price guote

 
 

Ratios help us to instantly check whether a business is sound, and also to compare ratios over a period in time. Ratios can be used for the following purposes: 1. Examining trends in results over a number of years. 2. Comparing the results of a business with results of other businesses. 3. Comparing the results of the business with the average results of all businesses in that sector...
displayed 300 characters

General issues of this essay:

Related essays:

x
Services