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    Formulae For Computation of Ratios Are As Follows

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    Mayukh Das
    The document lists formulas for computing various financial ratios. It provides the formulas to calculate: 1) Debt service coverage ratio, interest coverage ratio, debt equity ratio, current ratio, long term debt to working capital ratio, bad debts to accounts receivable ratio, current liability ratio, total debts to total assets ratio, debtors turnover ratio, inventory turnover ratio, operating margin percentage, and net profit margin percentage. 2) Each ratio is defined along with the mathematical formula used to compute it in terms of values derived from a company's financial statements.

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    Formulae For Computation of Ratios Are As Follows

    Uploaded by

    Mayukh Das
    14 views1 page
    The document lists formulas for computing various financial ratios. It provides the formulas to calculate: 1) Debt service coverage ratio, interest coverage ratio, debt equity ratio, current ratio, long term debt to working capital ratio, bad debts to accounts receivable ratio, current liability ratio, total debts to total assets ratio, debtors turnover ratio, inventory turnover ratio, operating margin percentage, and net profit margin percentage. 2) Each ratio is defined along with the mathematical formula used to compute it in terms of values derived from a company's financial statements.

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    The document lists formulas for computing various financial ratios. It provides the formulas to calculate: 1) Debt service coverage ratio, interest coverage ratio, debt equity ratio, current ratio, long term debt to working capital ratio, bad debts to accounts receivable ratio, current liability ratio, total debts to total assets ratio, debtors turnover ratio, inventory turnover ratio, operating margin percentage, and net profit margin percentage. 2) Each ratio is defined along with the mathematical formula used to compute it in terms of values derived from a company's financial statements.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    14 views1 page

    Formulae For Computation of Ratios Are As Follows

    Uploaded by

    Mayukh Das
    The document lists formulas for computing various financial ratios. It provides the formulas to calculate: 1) Debt service coverage ratio, interest coverage ratio, debt equity ratio, current ratio, long term debt to working capital ratio, bad debts to accounts receivable ratio, current liability ratio, total debts to total assets ratio, debtors turnover ratio, inventory turnover ratio, operating margin percentage, and net profit margin percentage. 2) Each ratio is defined along with the mathematical formula used to compute it in terms of values derived from a company's financial statements.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    4.

    Formulae for computation of ratios are as follows –


    Sr. Ratios Formulae

    a) Debt Service Coverage Earnings before Interest, Tax and Exceptional Items
    Ratio Interest Expense + Principal Repayments made during the
    period for long term loans

    b) Interest Service Earnings before Interest, Tax and Exceptional Items


    Coverage Ratio Interest Expense

    c) Debt Equity Ratio Total Debt


    Total Equity

    d) Current Ratio Current Assets


    Current Liabilities

    e) Long term debt to Non-Current Borrowings (Including Current Maturities of Non-


    working capital Current Borrowings)
    Current Assets Less Current Liabilities (Excluding Current
    Maturities of Non-Current Borrowings)

    f) Bad debts to Account Bad Debts


    receivable ratio Average Trade Receivables

    g) Current liability ratio Total Current Liabilities


    Total Liabilities

    h) Total debts to total Total Debt


    assets Total Assets

    i) Debtors turnover Value of Sales & Services


    Average Trade Receivables

    j) Inventory turnover Cost of Goods Sold (Cost of Material Consumed+ Purchases +


    Changes in Inventory + Manufacturing Expenses)

    Average Inventories of Finished Goods, Stock-in-Process and


    Stock-in-Trade

    k) Operating margin (%) Earnings before Interest, Tax and Exceptional Items
    less Other Income

    Value of Sales & Services

    l) Net profit margin (%) Profit After Tax (after exceptional items)
    Value of Sales & Services

    Registered Office: Corporate Communications Telephone : (+91 22) 2278 5000


    Maker Chambers IV Maker Chambers IV Telefax : (+91 22) 2278 5185
    3rd Floor, 222, Nariman Point 9th Floor, Nariman Point Internet : www.ril.com; [email protected]
    Mumbai 400 021, India Mumbai 400 021, India CIN : L17110MH1973PLC019786

    Page 4 of 16

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