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BASFIN1 Formula Sheet

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Richmond Esperidion (Sperrydion)
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9 views3 pages

BASFIN1 Formula Sheet

Uploaded by

Richmond Esperidion (Sperrydion)
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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A.

Liquidity Ratio

Current Ratio = Current Assets


Current Liabilities

Acid Test Ratio = Current Assets -


Inventories
Current Liabilities

Average Collection Period = Accounts Receivables


Annual Credit Sales/365 days

Accounts Receivable Turnover Ratio = Annual Credit Sales


Accounts Receivable

Inventory Turnover Ratio = Cost of Goods Sold


Inventories
B. Capital Structure Ratio

Debt Ratio = Total Debt


Total Assets

Times Interest Earned = Net Operating Income/EBIT


Interest Expense
C. Assets Management Efficiency Ratios
Total Asset Turnover = Sales .
Total Assets

Fixed Asset Turnover = Sales .


Net Plant and Equipment
D. Profitability Ratio

Gross Profit Margin = Gross Profit


Sales

Operating Profit Margin = Net Operating Income / EBIT


Sales

Net Profit Margin = Net Income


Sales

Operating Return on Assets = Net Operating Income / EBIT


Total Assets

Return on Equity = Net Income .


Common Equity

E. Market Value Ratio


Price / Earnings Ratio = Market Price per Share
Earning Price per Share
Market-to-Book Ratio = Market Price per Share
Book Value per Share

Financial Statement
Income Statement
Earnings per Share = Net Income .
Number of common shares outstanding
Dividends per Share = Dividends Paid .
Number of common shares outstanding
Balance Sheet
Net Working Capital = Current Assets – Current Liabilities

Assets = Liabilities + Owners Equity

Time Value of Money


Simple Interest
Simple Interest = Principal Amount x i

Annual Compounding Interest


n
FV n=PV [ 1+i ]
Where:
FV – future value i – interest rate
PV – present value n - periods
Intraperiod Compounding Interest

[ ]
mn
i
FV n=PV 1+
m
*m – intraperiod compounding / number of compounding within a year (ex. semiannually, quarterly)
Discounting

PV =FV n
[ ] 1
( 1+i )n
Solving for (n)

Solving of (i)

Rule 72: An approximate of how many years will it take for a given sum to double
72
Number of year ¿ double=
interest rate

COMPARING INTEREST RATES


Annual Percentage Rate: interest earned or paid in a year without compounding

( )(
Annual Percentage Rate= interest rate x compounding periods
per period per year ( m) )
*Interest rate per period examples: per month, per week
Effective Annual Rate: when rates being compared are not compounded for the same number of
periods of years

( )
m
Quoted Annual Rate
Effective Annual Rate= 1+ −1
m

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