Here is a list of some important financial ratio formulas.
1. Current Ratio = Current Assets/Current Liabilities
2. Net Working Capital Ratio = Net Working Capital/Net Assets
3. Quick Ratio = Quick Assets/Liquid Liabilities
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4. Cash Position Ratio = (Cash + Marketable Securities)/ Liquid Liabilities
5. Proprietary Ratio = Shareholders’ Fund/ Total Asset (or) Total Resources
6. Solvency Ratio = Outside Liabilities/Total Assets
7. Fixed Assets to Proprietors’ Fund Ratio = Fixed Assets/Proprietors’ Fund
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8. Current Assets to Proprietors’ Fund Ratio = Current Assets/Proprietors’ Funds
9. Capital Gearing Ratio = Fixed Interest Bearing Funds/Equity Share Capital
10. Debt-Equity Ratio = External Equities/Internal Equities or Outsiders Fund/Shareholders Fund
11. Fixed Assets to Current Assets = Fixed Assets/Current Assets
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12. Reserves to Equity Capital Ratio = Revenue Reserve/Equity Capital
13. Gross Profit Ratio = (Gross Profit/Net Sales) X 100
14. Operating Ratio = [(Cost of Goods Sold + Operating Expenses)/Net Sales] X 100
15. Material Consumed Ratio = (Material Consumed/Net Sale) X 100
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16. Conversion Cost Ratio = [(Manufacturing Expenses – Material Cost)/Net Sales} X 100
17. Particular Expense Ratio = (Particular Expense/Net Sales) X 100
18. Net Profit Ratio = (Net Profit/Net Sales) X 100
19. Return on Assets = (Net Profit/Net Sales) X 100
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20. Return on Capital Employed = Operating Profit/Capital Employed
21. Return on Shareholders’ Equity = (Net Profit/Shareholders’ Fund) X 100
22. Stock Turnover Ratio = Cost of Goods Sold (or) Net Sales/Average Inventory
23. Debtors Turnover Ratio = Credit Sales/Average Debtors or Total Sales/Closing Debtors
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24. Debt Collection Period = Months (or Days in a Year /Debtors Turnover
25. Creditors Turnover Ratio = Net Credit Purchases/Average Accounts Payable
26. Average Payment Period = (Accounts Payable/Net Credit Purchase) X 365
27. Working Capital Turnover Ratio = Cost of Sales/Net Working Capital
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28. Fixed Assets Turnover = Cost of Sales/Net Fixed Assets
29. Total Capital Turnover = Cost of Sales/Total Capital Employed
30. Capital Turnover = Cost of Sales/Capital Employed
31. Interest Coverage = EBIT/Fixed Interest Charges
32. Dividend Coverage = NP after Tax & Interest/Preference Dividend
33. Equity Shareholders’ Coverage = Net Profit (after Interest, Tax and Preference Dividend)/Equity Dividend
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34. Earning per Equity Shares = Profits Available for Equity Shares/No. of Equity Shares
35. Dividend Yield = Dividend per Share/Market Price per Share
36. Price Earning Ratio = Market Price of a Share/Earning per Share
37. Fixed Interest Coverage = Operating Income/Annual Interest Expenses
38. Dividend per Share = Dividend Paid to Equity Shareholders/No. of Equity Shares
39. Dividend Payout Ratio = Dividend per Share/Earning per Share