Ratios Flashcards
(13 cards)
1
Q
Gross profit
A
Sales revenue- cost of sales
2
Q
Net profit
A
Sales revenue - (cost of sales+expenses)
3
Q
GPM
A
Gross profit/sales turnover x 100
4
Q
NPM
A
Net profit/ sales turnover x100
5
Q
ROCE
A
Net profit/capital employed x100
6
Q
Gearing
A
Long term liabilities/ capital employed x100
7
Q
Current ratio
A
Current assets- current liabilities
8
Q
Acid test ratio
A
Current assets- stock/ current liabilites
9
Q
Working capital
A
Current assets - current liabilities
10
Q
Capital employed
A
Long term liabilities+ shareholders capital
11
Q
ARR
A
Average profit per year/ initial cost x 100
12
Q
Contribution
A
(SP-VC) x quantity
13
Q
Payback period
A
1) work out cumulative cash flow
2) identify year that it will pay back
3) minus initial cost from cumulative cash flow in year
4) divide by cumulative cash flow in next year
5) time by 12
