SUMMARY OF RATIOS Ratios to be Computed 1 Basic Components 2

Current Ratio Quick or Acid Test or Liquid Ratio (for immediate solvency). Absolute Liquid Ratio Inventory/stock Turnover Ratio Debtors or Receivables Turnover Ratio/ Velocity Average Collection Period Creditors/ Payables/ Turnover Ration/ Velocity Average Payment Period Working Capital Turnover Ratio Debt- Equity Ratio

Current Assets Current Liabilities Liquid/Quick Assets Current Liabilities Absolute Liquid Assets Current Liabilities Cost of Goods sold Average Inventory at cost Net Credit Annual Sales Average Trade Debtors Total Trade Debtors Sales Per day Net Credit Annual Purchase Average Trade Debtors Total Trade Creditors Average Daily Purchase Cost of Sales Net Working Capital Outsiders Funds or Shareholders Funds External Equities Internal Equities

Funded Debt to Total Capitalization Ratio Ratio of long term Debt to Shareholders Funds ( Debt-Equity)

Funded Debt * 100 Total Capitalization Long term debt Shareholders Funds

Proprietory or equity Ratio Solvency Ratio Fixed Assets Net Worth Ratio Fixed Assets Ratio or Fixed Assets To Long Term Funds. Ratio of Current Assets to Proprietors Funds Debt Service or Interest Coverage Ratio Total Coverage or Fixed Charge Coverage Preference Dividend Coverage Ratio

Shareholderss Funds Total Assets Total Liabilities to Outsiders Total Assets Fixed Assets (after depreciation) Shareholders Funds Fixed Assets (after depreciation). Total Long Term Funds. Currents assets Shareholders Funds Net Profit ( Before interest & Taxes) Fixed Interest Charges EBIT Fixed Interest Net Profit (before interest & Income taxes) Preference Dividend Annual Cash Flow(before Interest & Taxes) Sinking fund approp. On debt Interest + ------------------1-Tax Rate CF 1+ SFD 1-T Gross Profit * 100 Net Sales Operating Cost * 100 Net Sales Particular Expense * 100 Net Sales Net Profit after Tax * 100 Net Sales

Cash to Debt service Ratio or Debt Cash Flow Coverage

Gross Profit Ratio Operating Ratio Expense Ratio Net Profit Ratio

Operating Profit Ratio Return on Share Holders Investment or Networth (R.O.I). Return on Equity Capital

Operating Profit * 100 Net Sales Net Profit(after interest & tax) Shareholders Funds. Net Profit after taxPreference Div. Paid up Equity Capital. Net Profit after TaxPreference Dividend No. of Equity shares Adjusted Net Profit * 100 Gross Capital Employed Adjusted Net Profit * 100 Net Capital Employed Dividend per share Market value per share Dividend per Equity share Earnings per share

Earning Per Share(E.P.S)

Return on Gross Capital Employed Return on Net Capital Employed Dividend yield ratio Divident Pay-Out Ratio Or Pay-out Ratio Price Earning Ratio(P/E Ratio) Capital Gearing Ratio

Market price per equity share Earnings per share Equity share capital + Reserve & Surplus Pref. Capital + Long term debt bearing fixed interest. Shareholders funds + Long term Liabilities Long term Liabilities Outsiders Funds Shareholders Funds Fixed Assets Funded Debt Current Liabilities Shareholders Funds

Total Invetsment to Long Term Liabilities Debt Equity Ratio Ratio of Fixed Assets to Funded Debt Ratio of Current Liabilities to Proprietors Funds

Ratio of Reserves to Equity Capital Financial Leverage Operating Leverage

Reserves * 100 Equity Share Capital Earning Before Int. & Tax(EBIT) EBIT- Inter & Preference Dividend Contribution EBIT