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Transcript of RATIO ANALYSIS
Measure the ability of a company to pay off its short-term liabilities when they fall due.
:Absolute Liquid Ratio
The ratios used to determine about the companies’ financing methods, or the ability to meet the long term obligations
:Capital Gearing Ratio
:Fixed Asset Ratio
:Interest Coverage Ratio
:Dividend Coverage Ratio
:Debt Service Coverage Ratio
Used to assess a business's ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time
:Gross Profit Ratio
:Net Profit Ratio
Measures whether or not a firm has enough resources to pay its debts over the next 12 months
5 : 1
A technique of interpretation of financial statements with the help of various ratios by showing the quantitative relation between them.
Types Of Ratio Analysis
SHORT TERM LOANS
It indicates what proportion of equity and debt the company is using to finance its assets.
Debt-Equity ratio =
It is a popular tool to evaluate the operational performance of the business
: GROSS PROFIT RATIO :
GROSS PROFIT = Sales - COGS
Creditors Rs. 75,000 Cash in hand Rs. 1,00,000
Bills Payable Rs.75,000 Land Rs. 3,00,000
Bills ReceivableRs. 2,00,000
B/S of Management Express as on 31.3.2013
What is Gross profit ratio when the COGS is Rs. 50,000 and the sales are Rs. 1,00,000?
GPR=50,000 * 100
Current Ratio = 57,653,000
Debt-Equity Ratio = 16,958,000
Gross Profit Ratio = 13,024,000 * 100
Current Ratio = 87,269,017
Debt-Equity Ratio = 15,452,402
Gross Profit Ratio= 15,132,143 * 100
Smartphone Global Market Share 2013
:Gross Profit Ratio
An Apple a day,keeps Samsung away!
Reserves Rs 2,00,000
Equity Capital Rs2,50,000