A2 Ratios

Question 1

Trade Receivables Turnover [Days]

Efficiency Ratios

Answer 1

Trade Receivables / Credit Sales * 365

Question 2

Trade Payables Turnover [Days]

Efficiency Ratios

Answer 2

Trade Payables / Credit Purchases * 365

Question 3

Inventory Turnover [Days]

Efficiency Ratios

Answer 3

Average Inventory / Cost of Sales * 365

Question 4

Rate of Inventory Turnover [Times]

Efficiency Ratios

Answer 4

Cost of Sales / Average Inventory

Question 5

Working Capital Cycle [Days]

Solvency Ratios

Answer 5

Trade Receivables Turnover [Days] + Inventory Turnover [Days] - Trade Payables Turnover [Days]

Question 6

Networking Assets to Revenue [%]

Solvency Ratios

Answer 6

Net Working Assets / Revenue * 100

Question 7

Net Working Assets

Answer 7

Trade Recievables + Inventory - Trade Payables

Question 8

Interest Cover [Times]

Solvency Ratios

Answer 8

Profit From Operations / Interest Payable

Question 9

Gearing Ratio [%]

Solvency Ratios

Answer 9

Non-Current Liabilities / Issued Shares + Reserves + Non Current Liabilities * 100

Question 10

Earnings Per Share

Investment Ratios

Answer 10

Profit for the Year / Number of issued Ordinary Shares

Question 11

Price / Earnings

Investment Ratios

Answer 11

Market Price Per Share / Earnings Per Share

Question 12

Dividend Per Share

Investment Ratios

Answer 12

Annual Ordinary Dividend / Number of Ordinary Shares

Question 13

Annual Ordinary Dividend

Answer 13

Interim Dividend Paid + Final Dividend Proposed

Question 14

Dividend Yield

Investment Ratios

Answer 14

Dividend per Share / Market Price per Share * 100

Question 15

Dividend Cover

Investment Ratios

Answer 15

Profit Available / Annual Ordinary Dividend

Question 16

How do you find NCL when gearing % is given?

Answer 16

Gearing % x Equity / 1 - Gearing %

Question 17

How do you find Equity when gearing % is given?

Answer 17

Step 1: Gearing % * NCL = X
Step 2: NCL - X / Gearing %

Question 18

How do you find Current Assets when the Current % is given?

Answer 18

Current Assets Ratio * Current Liabilities

Question 19

How do you find Dividend Per Share when Dividend Yield is given?

Answer 19

Dividend Yield % * Market Price Per Share

Question 20

How do you find EPS when P/E is given?

Answer 20

Market Price Per Share / Price Earnings Ratio

Question 21

How do you find PFTY when EPS is given?

Answer 21

Earnings Per Share * Number of Ordinary Shares

Question 22

How do you find Opening Inventory Value when GPM is given?

Answer 22

1. Derive the % of COS from Revenue
2. Use Formula : COS - P / % of Closing Inventory

Question 23

How do you find TR/TP when the turnover ratio is given?

Answer 23

Days * Credit Value/365

Question 24

How do you find revenue / purchases when the TR/TP turnover is given?

Answer 24

365 * TR or TP / Days