Ratios for Financial Statement Analysis

Financial Ratios

U.S. GAAP Codification

IFRS

U.S. Tax Code

Accounting Ratios
for Financial Statement Analysis

U.S. GAAP Codification, U.S. Tax Code by Section, Securities Law Library

Financial Accounting, Intermediate Accounting, Advanced Accounting

ASC Accounting Standards, IFRS International Standards

Liquidity Analysis Ratios

Current Ratio

		Current Assets
	Current Ratio =	------------------------
		Current Liabilities

Quick Ratio

		Quick Assets
	Quick Ratio =	----------------------
		Current Liabilities

Quick Assets = Current Assets - Inventories

Net Working Capital Ratio

		Net Working Capital
	Net Working Capital Ratio =	--------------------------
		Total Assets

Net Working Capital = Current Assets - Current Liabilities

Profitability Analysis Ratios

Return on Assets (ROA)

		Net Income
	Return on Assets (ROA) =	----------------------------------
		Average Total Assets

Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2

Return on Equity (ROE)

		Net Income
	Return on Equity (ROE) =	--------------------------------------------
		Average Stockholders' Equity

Average Stockholders' Equity
= (Beginning Stockholders' Equity + Ending Stockholders' Equity) / 2

Return on Common Equity (ROCE)

		Net Income
	Return on Common Equity =	--------------------------------------------
		Average Common Stockholders' Equity

Average Common Stockholders' Equity
= (Beginning Common Stockholders' Equity + Ending Common Stockholders' Equity) / 2

Profit Margin

		Net Income
	Profit Margin =	-----------------
		Sales

Earnings Per Share (EPS)

		Net Income
	Earnings Per Share =	---------------------------------------------
		Number of Common Shares Outstanding

Activity Analysis Ratios

Assets Turnover Ratio

		Sales
	Assets Turnover Ratio =	----------------------------
		Average Total Assets

Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2

Accounts Receivable Turnover Ratio

		Sales
	Accounts Receivable Turnover Ratio =	-----------------------------------
		Average Accounts Receivable

Average Accounts Receivable
= (Beginning Accounts Receivable + Ending Accounts Receivable) / 2

Inventory Turnover Ratio

		Cost of Goods Sold
	Inventory Turnover Ratio =	---------------------------
		Average Inventories

Average Inventories = (Beginning Inventories + Ending Inventories) / 2

Capital Structure Analysis Ratios

Debt to Equity Ratio

		Total Liabilities
	Debt to Equity Ratio =	----------------------------------
		Total Stockholders' Equity

Interest Coverage Ratio

		Income Before Interest and Income Tax Expenses
	Interest Coverage Ratio =	-------------------------------------------------------
		Interest Expense

Income Before Interest and Income Tax Expenses
= Income Before Income Taxes + Interest Expense

Capital Market Analysis Ratios

Price Earnings (PE) Ratio

		Market Price of Common Stock Per Share
	Price Earnings Ratio =	------------------------------------------------------
		Earnings Per Share

Market to Book Ratio

		Market Price of Common Stock Per Share
	Market to Book Ratio =	-------------------------------------------------------
		Book Value of Equity Per Common Share

Book Value of Equity Per Common Share
= Book Value of Equity for Common Stock / Number of Common Shares

Dividend Yield

		Annual Dividends Per Common Share
	Dividend Yield =	------------------------------------------------
		Market Price of Common Stock Per Share

Book Value of Equity Per Common Share
= Book Value of Equity for Common Stock / Number of Common Shares

Dividend Payout Ratio

		Cash Dividends
	Dividend Payout Ratio =	--------------------
		Net Income

ROA = Profit Margin X Assets Turnover Ratio

	Net Income	Net Income	Sales
ROA =	------------------------ =	-------------- X	------------------------
	Average Total Assets	Sales	Average Total Assets

Profit Margin = Net Income / Sales
Assets Turnover Ratio = Sales / Averages Total Assets

50 Questions on Accounting Journal Entries
2012 Edition for iPhone and iPad

U.S. GAAP by Topic

International Financial Reporting Standards (IFRS)

Accounting Topics

Inventory Valuation Methods

Depreciation Methods

Revenue Recognition Principle

Accrual Basis vs. Cash Basis Accounting

Basics of Journal Entries

Ratios for Financial Statement Analysis

Overview of Financial Statements

Accounting Topics

Generally Accepted Accounting Principles, GAAP

Notes Receivable, Imputation of Interest

Accounting for Inventories

Inventory Valuation Methods: FIFO, LIFO

Inventory Valuation: Lower of Cost or Market

Depreciation Methods: Straight line method, Double-declining balance method

Investments in Debt and Equity Securities

Investments: Equity Method

Derivatives and Hedging, Fair Value Hedge, Cash Flow Hedge, Foreign Currency Hedge

Property, Plant and Equipment

Capitalization of Interest Costs

Accounting for Leases: Operating Lease, Capital Lease

Impairment of Assets

Intangible Assets

Goodwill

Impairment of Goodwill

Contingent Liabilities

Accounting for Bonds Payable

Accounting for Pension and Other Postretirement Benefits

Treasury Stock

Dividend, Stock Dividend, Stock Split

Revenue Recognition, Multiple-Element Revenue Arrangements

Share-based Payment, Stock Compensation

Income Statement

Comprehensive Income

Earnings per Share: Basic EPS, Diluted EPS

Statement of Financial Position, Balance Sheet

Statement of Cash Flows: Operating Activities, Investing Activities, Financing Activities

Financial Statement Analysis, Financial Ratios

Securities and Exchange Commission (SEC) Forms

Present Value, Future Value

Codification Topics at the 100 Level

Topic 105: Generally Accepted Accounting Principles

Codification Topics at the 200 Level

Topic 205: Presentation of Financial Statements

Topic 210: Balance Sheet

Topic 215: Statement of Shareholder Equity

Topic 220: Comprehensive Income

Topic 225: Income Statement

Topic 230: Statement of Cash Flows

Topic 235: Notes to Financial Statements

Topic 250: Accounting Changes and Error Corrections

Topic 255: Changing Prices

Topic 260: Earnings per Share

Topic 270: Interim Reporting

Topic 272: Limited Liability Entities

Topic 274: Personal Financial Statements

Topic 275: Risks and Uncertainties

Topic 280: Segment Reporting

Codification Topics at the 300 Level

Topic 305: Cash and Cash Equivalents

Topic 310: Receivables

Topic 320: Investments-Debt and Equity Securities

Topic 320-10-35: Transfers of Securities: Between Categories

Topic 323: Investments-Equity Method and Joint Ventures

Topic 325: Investments-Other

Topic 330: Inventory

Topic 340: Other Assets and Deferred Costs

Topic 350: Intangibles-Goodwill and Other

Topic 360: Property, Plant, and Equipment

Codification Topics at the 400 Level

Topic 405: Liabilities

Topic 410: Asset Retirement and Environmental Obligations

Topic 420: Exit or Disposal Cost Obligations

Topic 430: Deferred Revenue

Topic 440: Commitments

Topic 450: Contingencies

Topic 460: Guarantees

Topic 470: Debt

Topic 480: Distinguishing Liabilities from Equity

U.S. GAAP Codification of Accounting Standards

Accounting Standards Codification, ASC, Overview

ASC Codification 100: General Principles

ASC Codification 200: Presentation

ASC Codification 300: Assets

ASC Codification 400: Liabilities

ASC Codification 500: Equity

ASC Codification 600: Revenue

ASC Codification 700: Expenses

ASC Codification 800: Broad Transactions

ASC Codification 900: Industry