TMP 120 Lecture Notes - Lecture 9: Capital Structure, Asset
Document Summary
Liquidity ratios: current ratio = current assets want assets to be larger than one. Current liabilities: acid test = cash + cash equivalents + market securities + acts. Current liabilities: collection period = average accounts receivable, days to sell inventory = average inventory. Inventory turnover = cost of goods sold: cash turnover , accounts receivable turnover , working capital turnover = sales, ppe turnover , total assets turnover = sales. Average total assets: asset to sales: total assets. Returns - related ratios (asset ratios: return on assets = net income + interest expense (1-tax rate, return on common equity = net income, return on sales = net income. Shareholder"s equity: total debt to equity = total liabilities, long-term debt to equity = long-term liabilities. Shareholder"s equity: times interest earned= income before income taxes and. Market measure ratios: % growth in sales: sales current yr sales prior yr =
