基础会计学英文版Lesson10-enUnderstanding and Using Financial Statements.ppt

* * * * * * * * * * * * * * A variant of the receivables turnover ratio is to convert it to an average collection period in terms of days. This means that receivables are collected on average every 21 days. $1,818,500 ($107,800 + $102,800) / 2 = 17.3 times 365 days / 17.3 times = every 21.1 days Receivables Turnover * Ratio Analysis – Liquidity Ratios Compute the Inventory Turnover ratio for 2012. Inventory turnover measures the number of times, on average, the inventory is sold during the period. $1,011,500 ($133,000 + $115,500) / 2 = 8.1 times Cost of Good Sold Average Inventory Inventory Turnover = * Ratio Analysis – Liquidity Ratios A variant of inventory turnover is the days in inventory. Inventory turnover ratios vary considerably among industries. 365 days / 8.1 times = every 45.1 days $1,011,500 ($133,000 + $115,500) / 2 = 8.1 times Inventory Turnover * Ratio Analysis – Liquidity Ratios Measure the income or operating success of a company for a given period of time. Income, or the lack of it, affects the company’s ability to obtain debt and equity financing, liquidity position, and the ability to grow. Ratios include the profit margin, asset turnover, return on assets, return on common stockholders’ equity, earnings per share, price-earnings, and payout ratio. Ratio Analysis – Profitability Ratios * Compute the Profit Margin ratio for 2012. Measures the percentage of each dollar of sales that results in net income. $199,000 $1,818,500 = 10.9% Net Income Net Sales Profit Margin = * Ratio Analysis – Profitability Ratios Compute the Asset Turnover ratio for 2012. Measures how efficiently a company uses its assets to generate sales. $1,818,500 ($970,200 + $852,800) / 2 = 2.0 times Net Sales Average Assets Asset Turnover = * Ratio Analysis – Profitability Ratios Compute the Return on Assets ratio for 2012. An overall measure of profitability. $199,000 ($970,200 + $852,800) / 2 = 21.8% Net Income Average Assets Return on Ass