This document discusses various financial ratios used to analyze a company's liquidity, debt management, asset utilization, profitability, and overall financial performance. It covers key liquidity ratios like current ratio and quick ratio. Debt management ratios include debt ratio and debt-to-equity ratio. Asset utilization ratios assess efficiency, like total asset turnover. Profitability ratios measure margins and returns on assets/equity. The DuPont analysis breaks return on equity into profit margin and total asset turnover components. Modern techniques also examine market value added and economic value added.
ChapterTool KitChapter 7102715Corporate Valuation and Stock Valu.docxtiffanyd4
ChapterTool KitChapter 710/27/15Corporate Valuation and Stock Valuation7-4 Valuing Common Stocks—Introducing the Free Cash Flow (FCF) Valuation ModelData for B&B Corporation (Millions)Constant free cash flow (FCF) =$10Weighted average cost of capital (WACC) =10%Short-term investments =$2Debt =$28Preferred stock =$4Number of shares of common stock =5The first step is to estimate the value of operations, which is the present value of all expected free cash flows. Because the FCF's are expected to be constant, this is a perpetuity. The present value of a perpetuity is the cash flow divided by the cost of capital:Value of operations (Vop) =FCF/WACCValue of operations (Vop) =$100.00millionB&B's total value is the sum of value of operations and the short-term investments: Value of operations$100+ ST investments$2Estimated total intrinsic value$102The next step is to estimate the intrinsic value of equity, which is the remaining total value after accounting for the claims of debtholders and preferred stockholders: Value of operations$100+ ST investments$2Estimated total intrinsic value$102− All debt$28− Preferred stock$4Estimated intrinsic value of equity$70The final step is to estimate the intrinsic common stock price per share, which is the estimated intrinsic value of equity divided by the number of shares of common stock: Value of operations$100+ ST investments$2Estimated total intrinsic value$102− All debt$28− Preferred stock$4Estimated intrinsic value of equity$70÷ Number of shares5Estimated intrinsic stock price =$14.00The figure below shows a summary of the previous calculations.Figure 7-2B&B Corporation's Sources of Value and Claims on Value (Millions of Dollars except Per Share Data)Inputs:Valuation AnalysisConstant free cash flow (FCF) =$10Value of operations$100Weighted average cost of capital (WACC) =10%+ ST investments$2Short-term investments =$2Estimated total intrinsic value$102Debt =$28− All debt$28Preferred stock =$4− Preferred stock$4Number of shares of common stock =5Estimated intrinsic value of equity$70÷ Number of shares5Estimated intrinsic stock price$14.00Data for Pie ChartsShort-term investments =$2Value of operations =$100Total =$102Debt =$28Preferred stock =$4Estimated equity value =$70Total =$1027-5 The Constant Growth Model: Valuation when Expected Free Cash Flow Grows at a Constant RateCase 1: The expected free cash flow at t=1 and the expected constant growth rate after t=1 are known.First expected free cash flow (FCF1) =$105Weighted average cost of capital (WACC) =9%Constant growth rate (gL) =5%When free cash flows are expected to grow at a constant rate, the value of operations is:Value of operations (Vop) =FCF1 / [WACC-gL]Value of operations (Vop) =$2,625Case 2: Constant growth is expected to begin immediately.Most recent free cash flow (FCF0) =$200Weighted average cost of capital (WACC) =12%Constant growth rate (gL) =7%When free cash flows are expected to grow at a constant rate, the value of operations is:.
Accounting 970602 paper 2 structured questions for examination from 2016 spec...Alpro
Accounting 970602 paper 2 structured questions for examination from 2016 specimen mark scheme
Advanced Level
A Level
Zimsec
Cambridge
Alpro Learning Portal
Accounting
Accounts
Zimbabwe
Principle of accounts
Financial Management
GRADE: 39%
This is the planning, organization and control of financial activities in business premises. This function in estimating capital requirements, determining capital composition, the source of funds, where the funds should be invested and management of the surplus finances. This is done with the aim resource efficiency, accountability, counter competition and plan on long-term financial sustainability.
1. Financial Statements and Ratios
(a) Accounts receivable for 2015 is given by;
Current assets – (cash and marketable securities + inventory)
= (1542) $ - (427+815) $ = $300
(b) Accounts payable for 2014 is given by;
= current liabilities – (notes payable + accrued wages and taxes)
= (997) $ - (421+257) $ = $319
(c) Gross plant and equipment for 2015 is given by;
= net plant and equipment – depreciation
= $2872 - $368 = $2504
(d) Long term debt for 2014 is given by;
= long term liabilities – current liabilities
= $2956 - $ 997 = $1959
(e) Common stock and paid-in surplus (250 million shares) for 2014 is given by;
= total equity – (preferred stock + retained earnings)
= (1472) $ – (30+1142) $ = $300
(f) Total FA for 2015 is given by;
= net plant and equipment – other long term assets
= $2872 + $521 = $3393
(g) Net sales for 2015 is given by;
Gross profits – cost of goods sold
= $1623 + $753 = $2376
(h) Less cost of goods sold in 2014 is given by;
Net sales – other operating expenses
= $2018 - $1189 = $829
(i) Less interest for 2015 is given by;
= earnings before interest and taxes (EBIT) – Earnings before taxes (EBT)
= $1086 - $949 = $137
(j) Less taxes for 2015 is given by;
= earnings before taxes (EBT) – net income
= $946 - $664 = $285
(k) Earnings per share (EPS) for 2015 is given by;
= Net income available to common stock holders divided by addition to retained income
= $566/$347 = $1.63
(l) Dividends per share (DPS) for 2014 is given by;
= common stock dividends divided by addition to retained income less preferred stock dividends
= $(199)/$(249 – 98) = $1.32
(m) Book value per share (BVPS) for 2015 is given by;
= net sales divided by shares outstanding
= $2376/$445 = $5.34
(n) Net income
Since; EBITDA = Gross profit – selling, general and administrative expenses,
EBIT = EBITDA – depreciation+ amortization expenses.
EBT = EBIT – interest expenses
Net income = EBT – tax expenses.
= $664
(o) Increase in accrued wages and taxes is given by;
= accrued wages recorded at the start – accrued wages recorded at the end
= $309 - $257 = $52
(p) Increase in inventory is given by;
Inventory at the opening of a balance sheet – inventory recorded at the close of a balance sheet.
= $815 - $797 = $18
(q) Net cash flow from operating activities
EBIT + depreciation = cash flow from operating activities
= $114 + $1086 = $1200
(r) Increase in other long term assets is given by;
= Long term assets at the start – long term assets at the close of a balance sheet
$521 - $487 = $34
(s) Net cas ...
Meaning
Purpose
Forms of presenting comparative statement
Comparative Balance Sheet
Advantage of comparative balance sheet
Format of comparative balance sheet
Illustration
Exercise
Comparative statements of profit & loss
Objective of comparative statement of profit & loss
Format of comparative statement of profit & loss
Illustration
Exercise
ChapterTool KitChapter 7102715Corporate Valuation and Stock Valu.docxtiffanyd4
ChapterTool KitChapter 710/27/15Corporate Valuation and Stock Valuation7-4 Valuing Common Stocks—Introducing the Free Cash Flow (FCF) Valuation ModelData for B&B Corporation (Millions)Constant free cash flow (FCF) =$10Weighted average cost of capital (WACC) =10%Short-term investments =$2Debt =$28Preferred stock =$4Number of shares of common stock =5The first step is to estimate the value of operations, which is the present value of all expected free cash flows. Because the FCF's are expected to be constant, this is a perpetuity. The present value of a perpetuity is the cash flow divided by the cost of capital:Value of operations (Vop) =FCF/WACCValue of operations (Vop) =$100.00millionB&B's total value is the sum of value of operations and the short-term investments: Value of operations$100+ ST investments$2Estimated total intrinsic value$102The next step is to estimate the intrinsic value of equity, which is the remaining total value after accounting for the claims of debtholders and preferred stockholders: Value of operations$100+ ST investments$2Estimated total intrinsic value$102− All debt$28− Preferred stock$4Estimated intrinsic value of equity$70The final step is to estimate the intrinsic common stock price per share, which is the estimated intrinsic value of equity divided by the number of shares of common stock: Value of operations$100+ ST investments$2Estimated total intrinsic value$102− All debt$28− Preferred stock$4Estimated intrinsic value of equity$70÷ Number of shares5Estimated intrinsic stock price =$14.00The figure below shows a summary of the previous calculations.Figure 7-2B&B Corporation's Sources of Value and Claims on Value (Millions of Dollars except Per Share Data)Inputs:Valuation AnalysisConstant free cash flow (FCF) =$10Value of operations$100Weighted average cost of capital (WACC) =10%+ ST investments$2Short-term investments =$2Estimated total intrinsic value$102Debt =$28− All debt$28Preferred stock =$4− Preferred stock$4Number of shares of common stock =5Estimated intrinsic value of equity$70÷ Number of shares5Estimated intrinsic stock price$14.00Data for Pie ChartsShort-term investments =$2Value of operations =$100Total =$102Debt =$28Preferred stock =$4Estimated equity value =$70Total =$1027-5 The Constant Growth Model: Valuation when Expected Free Cash Flow Grows at a Constant RateCase 1: The expected free cash flow at t=1 and the expected constant growth rate after t=1 are known.First expected free cash flow (FCF1) =$105Weighted average cost of capital (WACC) =9%Constant growth rate (gL) =5%When free cash flows are expected to grow at a constant rate, the value of operations is:Value of operations (Vop) =FCF1 / [WACC-gL]Value of operations (Vop) =$2,625Case 2: Constant growth is expected to begin immediately.Most recent free cash flow (FCF0) =$200Weighted average cost of capital (WACC) =12%Constant growth rate (gL) =7%When free cash flows are expected to grow at a constant rate, the value of operations is:.
Accounting 970602 paper 2 structured questions for examination from 2016 spec...Alpro
Accounting 970602 paper 2 structured questions for examination from 2016 specimen mark scheme
Advanced Level
A Level
Zimsec
Cambridge
Alpro Learning Portal
Accounting
Accounts
Zimbabwe
Principle of accounts
Financial Management
GRADE: 39%
This is the planning, organization and control of financial activities in business premises. This function in estimating capital requirements, determining capital composition, the source of funds, where the funds should be invested and management of the surplus finances. This is done with the aim resource efficiency, accountability, counter competition and plan on long-term financial sustainability.
1. Financial Statements and Ratios
(a) Accounts receivable for 2015 is given by;
Current assets – (cash and marketable securities + inventory)
= (1542) $ - (427+815) $ = $300
(b) Accounts payable for 2014 is given by;
= current liabilities – (notes payable + accrued wages and taxes)
= (997) $ - (421+257) $ = $319
(c) Gross plant and equipment for 2015 is given by;
= net plant and equipment – depreciation
= $2872 - $368 = $2504
(d) Long term debt for 2014 is given by;
= long term liabilities – current liabilities
= $2956 - $ 997 = $1959
(e) Common stock and paid-in surplus (250 million shares) for 2014 is given by;
= total equity – (preferred stock + retained earnings)
= (1472) $ – (30+1142) $ = $300
(f) Total FA for 2015 is given by;
= net plant and equipment – other long term assets
= $2872 + $521 = $3393
(g) Net sales for 2015 is given by;
Gross profits – cost of goods sold
= $1623 + $753 = $2376
(h) Less cost of goods sold in 2014 is given by;
Net sales – other operating expenses
= $2018 - $1189 = $829
(i) Less interest for 2015 is given by;
= earnings before interest and taxes (EBIT) – Earnings before taxes (EBT)
= $1086 - $949 = $137
(j) Less taxes for 2015 is given by;
= earnings before taxes (EBT) – net income
= $946 - $664 = $285
(k) Earnings per share (EPS) for 2015 is given by;
= Net income available to common stock holders divided by addition to retained income
= $566/$347 = $1.63
(l) Dividends per share (DPS) for 2014 is given by;
= common stock dividends divided by addition to retained income less preferred stock dividends
= $(199)/$(249 – 98) = $1.32
(m) Book value per share (BVPS) for 2015 is given by;
= net sales divided by shares outstanding
= $2376/$445 = $5.34
(n) Net income
Since; EBITDA = Gross profit – selling, general and administrative expenses,
EBIT = EBITDA – depreciation+ amortization expenses.
EBT = EBIT – interest expenses
Net income = EBT – tax expenses.
= $664
(o) Increase in accrued wages and taxes is given by;
= accrued wages recorded at the start – accrued wages recorded at the end
= $309 - $257 = $52
(p) Increase in inventory is given by;
Inventory at the opening of a balance sheet – inventory recorded at the close of a balance sheet.
= $815 - $797 = $18
(q) Net cash flow from operating activities
EBIT + depreciation = cash flow from operating activities
= $114 + $1086 = $1200
(r) Increase in other long term assets is given by;
= Long term assets at the start – long term assets at the close of a balance sheet
$521 - $487 = $34
(s) Net cas ...
Meaning
Purpose
Forms of presenting comparative statement
Comparative Balance Sheet
Advantage of comparative balance sheet
Format of comparative balance sheet
Illustration
Exercise
Comparative statements of profit & loss
Objective of comparative statement of profit & loss
Format of comparative statement of profit & loss
Illustration
Exercise
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
2. (1) Liquidity Ratios:
xxxx
(1) Liquidity Rati
A - Current ratio = Current assets / Current Liabilities
If x/y =2
Every unit of the denominator (liab.) is covered /backed up / financed /
yield by 2 unit of the nominator (asset)
B - Quick or Acid ratio = (Current assets – Inventory) /
Current Liabilities
C- Cash ratio = (CA – INV. – AR – S.T. Invest) or cash in kind /
CL
3. Liquidity of AR:
- Average Collection Period (ACP) = (Balance of AR X
360) / Credit Sales
If credit sales not given, assume all sales are on credit
Liquidity of Inventory:
- Average selling Period (ASP) + Average Collection
Period (ACP)
ASP = (Inventory X 360) / COGS
The larger the Liquidity of INV, the greater the need for
cash to finance operations
4. Condition for using ratios
1) Current ratios = both ACP + ASP can be
liquidated in less than 360 days for a good
ratio.
2) Quick ratio = liquidation of AR (ACP) < 360
Liquidation of Inventory > 360
3) Cash ratio = ACP > 360
ASP > 360
5. (2) Debt Management Ratios:
A - Debt ratio = Total Debts / Total assets
B - Debt / Equity ratio = Total Debts / Equity
The Higher the ratios the more risky the Company is
C - Capital structure ratio (CSR) = LTL / (LTL + ME)
D - Interest Coverage Ratio = EBIT (Earning
before Interest & Tax) / I
6. (3) Assets utilization / management
(activity /efficiency ratios):
A - Total Assets Turnover (TAT) = Sales / Total assets
B - Fixed Assets Turnover (FAT) = Sales / FA
C - Current Assets Turnover (CAT) = Sales / CA
For:
(1) Cash To = Sales / Cash
(2) AR To = Credit Sales / AR
(3) Inventory To = COGS / Inventory
To = Turnover
D & E - Liquidity of AR & Liquidity of Inventory;
Same as before
7. (4) Profitability ratios:
A- sales:
1) GPM gross profit margin = GP / sales
2) OIM operating income margin = OI / sales =
( Sales-COGS -Others) / sales
3) NIM net income margin = NI / Sales
B- Financial performances:
Return on assets (investment) ROI = EBIT / Total Assets
Return on Equity (ROE) = EBT / Equity
C- ROBF = {ROI – (Interest / BF) {x (BF/OE)
D- ROE = ROI + ROBF
8. Dupont system of ratios
(ROI= EBIT/Total assets) x sales / sales
ROI =EBIT/Sales x Sales/ Total assets
ROI = x
Profitability x Efficiency
Net Profit
Margin TATO
9. Modern tech. of analysis
MVA
Market value added =
(No. of shares x
market value of shares) –
total O/E
EVA
Economic value added=NP - total cost
of capital
Long term bonds :Interest
Preferred shares : p.s. dividends
Common shares : dividends
R/E : assuming in the bank / opp. Cost =
10%
