Exam 1 Formulas Flashcards Preview

Managerial Accounting > Exam 1 Formulas > Flashcards

Flashcards in Exam 1 Formulas Deck (24):
1

Liquidity Ratios

Working Capital
Current Ratio
Quick Ratio

2

Ability to sell inventory and collect receivables

Inventory turnover
Accounts Receivable Turnover
Days' Sales in receivables

3

Ability to Pay Long Term Debt Ratios

Debt ratio
Times Interest Earned Ratio

4

Profitability Ratios

Return on Sales
Return on Total Assets
Return on Equity
Earnings Per Share

5

Working Capital

Current Assets - Current Liabilities

6

Current Ratio

Current Assets / Current Liabilities

7

Quick Ratio

(Cash + Short Term Investments + Net Receivables) / Current Liabilities

8

Inventory Turnover

Cost of Goods Sold / Average Inventory

9

Accounts Receivable Turnover

Net Credit Sales / Average Net Accounts Receivable

10

Days' Sales in Receivables

One Day's Sales

Net Sales / 365 days

Then...

Average Accounts Receivables / One Day's Sales

11

Debt Ratio

Total Liabilities / Total Assets

12

Times Interest Earned Ratio

Income from Operations / Interest Expense

13

Return on Sales

Net Income / Net Sales

14

Return on Total Assets

Net Income + Interest Expense / Average Total Assets

15

Return on Equity

(Net Income - Preferred Dividends Declared) / Average Common Stockholder's Equity

Average Common Stockholder's Equity = (RE + CS)

16

Earnings Per Share

(Net Income - Preferred Dividends) / Average # of Common Shares Outstanding

17

Analyzing Stock Investments

Price Earnings Ratio
Dividend Yield

18

Price Earnings Ratio

Market Price per Common Share / Earnings Per Share of Common Stock

19

Dividend Yield

Dividend per Share of Common Stock / Market Price per Common Share of Stock

20

Prime Costs

Direct Materials + Direct Labor

21

Conversion Costs

Direct Labor + Manufacturing Overhead

22

Cost of Goods Sold

Beginning Inventory + Purchases - Ending Inventory

23

Gross Profit

Net Sales - COGS

24

Net Income

Gross Profit - (Selling, General, Administrative Expenses)