Accounting ratios

Cost of revenue from operation

• revenue from operation-gross profit

• revenue from operation+gross loss

• purchase + sales

• current assets+non current assets

Working Capital formula?

• Current assets-current liabilities

• Current assets-non current liabilities

• stock +prepaid expense

Preferable Current ratio

• 2:1

• 3:2

• 1:4

• 4:1

Proprietary ratio

• Equity/total assets

• total assets/Dept

• equity/dept

• dept/equity

Interest Coverage Ratio

(a)  

Equity is...

• Total Assets

• Current + non=current assets

• Share holders fund

• Liabilities

Total sales is?

• Cost of goods sold +gross profit

• credit purchase+ purchase returns

• Revenue from operations +returns

• revenue from operation -cost of revenue from operations

Working Capital= [ans in small letter, no abbreviations]

(a)  

Trade payable turnover ratio

• Credit revenue from operations/average trade receivable

• revenue from operation/working capital

• Net credit purchase/Average trade payable

Debt is .....

• Current liability

• Non-current liability

• Long-term borrowing

• Total liability