COMM 203 Lecture Notes - Lecture 3: Operating Cash Flow, Fixed Asset, Net Income
Document Summary
Sales cost of goods sold depreciation/operating exp. Earning per share = net income/ total shares outstanding. Dividend per share = total dividend/ total shares outstanding. Ending net fixed assets (find in the balance sheet) + depreciation ( find on the income statement) Ending nwc ( watch for the year )(2009) Fixed asset(balance sheet) + depre (income statement) (negative) Short term solvency: can the firm pay its bills over the short run without undue stress. Current ratio the quick (or acid test) ratio. Long term solvency measures: address the firm"s long run ability to meet its obligations or more generally its financial leverage. Cash coverage ratio: is useful for determining the amount of cash available to pay for borrowers" expense. Asset turnover ratio: measures how much work we get out of our working capital. Profitability measures: measures how efficiently the firm uses its assets and how much efficiently the firm manages its operations, net income.
