Ratio Analysis FWhy Conduct Ratio Analysis?  FRatios Are Used To Evaluate:  FClassifications of Ratios:

Slides:

Advertisements

Similar presentations

Th 9 ©The McGraw-Hill Companies, Inc Foundations of Financial Management E D I T I O N N I N T H Irwin/McGraw-Hill Block Hirt MANAJEMEN KEUANGAN.

Advertisements

Financial Statement Analysis

Rate Earned on Average Total Assets n (January 1 Total assets + December 31 Total Assets) / 2 = Average Total Assets n Net Income after Federal Income.

Calculations Lindsay Rodrigue Accounting 30 Ms. Lozinski May 29, 2001.

Current Ratio Start Card Who has ……. Who Has…I Have… Creditors Days (Average period of credit received) Current Assets Current Liabilities.

July 8, Financial Ratio Analysis Financial ratios combine different financial parameters. They are based on the financial data drawn from the balance.

(using financial statements)

GET RICH QUICK CO. Financial Statement Ratio Analysis: Profitability Long-Term Financial Position Short-Term Financial Position.

Chapter 3 Analysis of Financial Statements

Essentials of Investments © 2001 The McGraw-Hill Companies, Inc. All rights reserved. Fourth Edition Irwin / McGraw-Hill Bodie Kane Marcus 1 Chapter 14.

CF Winter Winter Corporate Finance 1.Capital Budgeting  Long-term investments which ones? 2.Capital Structure  Long-term financing.

Fall-02 Investments Zvi Wiener tel: Financial Statement Analysis BKM.

Financial Statement Analysis

McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Financial Statement Analysis CHAPTER 14.

Finance/Accounting Functional Review. The Finance/Accounting Functions Defined Investment Decision The Allocation and Reallocation of Capital and Resources.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible Web site, in whole or in part.

Steve Paulone Facilitator Things to consider concerning financial ratios:  A ratio by itself means very little – you need to compare that result with:

Financial Statement Analysis

Chapter Thirteen Financial Statement Analysis Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin.

FINANCIAL STATEMENT ANALYSIS UNIT 12 Analysing financial statements involves evaluating three characteristics of a company: 1. its liquidity 2. its profitability.

Copyright © 2007 South-Western. All rights reserved. Chapter 15 Accounting and Financial Analysis.

Parts of a Financial Statement 1.Statement of Income 2.Balance Sheet 3.Statement of Cash Flow 4.Statement of Stockholders’ Equity.

Financial Statements Ratio Analysis

Corporate Finance A1 Vysoká škola finanční a správní Summer Semester 2012 Jaromír R. Stemberg

Historical Performance Analysis Analysts:. 3-Year Compound Average Growth Rates.

3-0 Ratio Analysis 3.3 Ratios also allow for better comparison through time or between companies As we look at each ratio, ask yourself what the ratio.

Evaluating a Firm’s Financial Performance , Prentice Hall, Inc.

WORKING WITH FINANCIAL STATEMENTS Chapter 3. Key Concepts and Skills  Understand sources and uses of cash and the Statement of Cash Flows  Know how.

Chapter 18-1 LO 5 Identify and compute ratios used in analyzing a firm’s liquidity, profitability, and solvency. Ratio Analysis Illustration.

Chapter 3 Financial Analysis.

Parts of a Financial Statement 1.Statement of Income 2.Balance Sheet 3.Statement of Cash Flow 4.Statement of Stockholders’ Equity.

Intro to Financial Management Evaluating a Firm’s Financial Performance.

Chapter 11 Analysis of Financial Statements © 2005 Thomson/South-Western.

Financial Statement Analysis. Two Primary Statements Balance Sheet –Snapshot –BV vs MV Income Statement –Period of time.

Interested parties  Shareholders - to measure management’s performance  Investors - to make their investment decisions  Management - to plan and control.

Finance Chapter 3 Analysis of financial statements.

Chapter 2 Financial Ratio Analysis. 2-2 Example 2.1 Problem  Rylan Enterprises has 5 million shares outstanding.  The market price per share is $22.

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 17-2 Calculating Earnings Performance and Efficiency Analysis.

Financial Statement Analysis. Common Financial Statements  Balance Sheet  Income Statement  Statement of Retained Earnings  Statement of Cash Flows.

Ratios and Accounting A 1 to 1 training course (get it!)

Types of Ratio Analysis FTime Series, Historical, or Trend Analysis  Example: FCross-Sectional or Peer Comparison Analysis  Example:  Sources of Comparative.

©2012 McGraw-Hill Ryerson Limited 1 of 34 Learning Objectives 1.Calculate 13 financial ratios that measure profitability, asset utilization, liquidity.

Fourth Edition 1 Financial Statement Analysis. Fourth Edition 2 Outline 1.Financial statements 1.Income statement and margin analysis 2.Ratio analysis.

V. STOCKS. L. RATIO ANALYSIS 1.Ratios That Measure Liquidity (the firm’s ability to convert assets into cash) a.Current Ratio = Current Assets Current.

1 Chapter 03 Analyzing Financial Statements McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.

McGraw-Hill/Irwin Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 19 Financial Statement Analysis.

Current Ratio Profit (after tax and preference dividends) Number of Issued Ordinary Shares.

Chapter 3 Financial Analysis.

Financial Statement Analysis Chapter 9

Presented by: Lauren Rudd Tel: March 26, 2013.

17-1 Ratios can be expressed in three different ways: 1. Ratio (e.g., current ratio of 2:1) 2. % (e.g., profit margin of 2%) 3. $ (e.g., EPS of $2.25)

(c) 2001 Contemporary Engineering Economics 1 Before making Financial Decision – understand financial situation Accounting records to aid in making decisions.

Key West Productions Ratio Analysis. Ratios Division A Division B Division C Entire Corporation A) Current Ratio B) Quick Ratio

McGraw-Hill/Irwin © 2007 The McGraw-Hill Companies, Inc., All Rights Reserved. Financial Statement Analysis CHAPTER 13.

 The McGraw-Hill Companies, Inc., 1999 INVESTMENTS Fourth Edition Bodie Kane Marcus Irwin/McGraw-Hill 19-1 Financial Statement Analysis Chapter 19.

Chapter 3 - Evaluating a Firm’s Financial Performance

Pre – MBA Program Accounting Ratios Nov 11, 2012.

Historical Performance Analysis

Financial Statement Analysis

Financial Statement Analysis

Financial Statement Analysis

Analysis Example Financial Ratio

3 Chapter Financial Analysis.

Financial Statement Analysis

T I M C O K By: Amanda D. Barlow.

PRESENTED BY- ABHINAV RASTOGI

ACC 545 Education for Service-- snaptutorial.com.

CH4- In class exercise.

Intro to Financial Management

Lesson 13-2 SHARE OF NET INCOME ASSIGNED TO PREFERRED AND COMMON STOCK

Presentation transcript:

Ratio Analysis FWhy Conduct Ratio Analysis?  FRatios Are Used To Evaluate:  FClassifications of Ratios:

Liquidity Ratios F Definition/Purpose -  Current Ratio = Current Assets / Current Liabilities Notes:  Quick Ratio = (Current Assets - Inventories) / Current Liabilities Notes:  Net Working Capital = Current Assets - Current Liabilities Notes: P Conclusion/Interpretation -

Asset Management Ratios F Definition/Purpose -  Inventory Turnover Ratio = Sales / Inventories Notes:  Average Collection Period = Receivables / Average Sales per Day Notes:  Fixed Asset Turnover = Sales / Net Fixed Assets Notes:

Asset Management Ratios, cont.  Total Asset Turnover = Sales / Total Assets Notes:  Receivables Turnover = Sales / Receivables Notes: P Conclusion/Interpretation -

Debt Management Ratios F Definition/Purpose -  Debt Ratio = Total Debt / Total Assets Notes:  Times-Interest-Earned Ratio = EBIT / Interest Charges Notes:  Fixed Charge Coverage Ratio = (EBIT+LP) / [I+LP+(SFP/(1-T))] Notes: P Conclusion/Interpretation -

Profitability Ratios F Definition/Purpose -  Profit Margin = Net Income Available to Common Stockholders / Sales Notes:  Basic Earning Power = EBIT / Total Assets Notes:  Return on Assets = Net Income Available to Common Stockholders / Total Assets Notes:  Return on Equity = Net Income Available to Common Stockholders / Common Equity Notes: P Conclusion/Interpretation -

Market Value Ratios F Definition/Purpose -  Price Earnings (P/E) Ratio = Price per Share / Earnings per Share Notes:  Market-to-Book (Tobin’s Q) Ratio = Market Value / Book Value Notes: P Conclusion/Interpretation -