CA Aspirant|Content ... • 21d
Daily(irregular 😅) dose of financial ratios by Anirudh Gupta Lets learn these two ratios 1.Capital turnover ratio: =Sales or Cost of goods sold/Capital employed Capital employed=Shareholders funds+ Non-current liabilities Purpose: -To understand, how many rupees of revenue are generated for every ₹1 of capital invested in the business? -Tests the company usage of assets to generate sales. 2. Ebit margin =Ebit or operating profit /sales Purpose: -It measures the profit a company earns from its operations, before deducting interest and taxes, for every rupee of sales generated. -To judge the company’s performance. These two ratios combined will result in a new ratio ,which we will discuss in the next post. It's actually a dead easy guess.Find it out! Stay tuned. Will come up with more posts which are not just limited to financial ratios.
CA Aspirant|Content ... • 26d
Daily dose of financial ratios by Anirudh Gupta Debt service coverage ratio: =Earnings available for debt services/(Interest+Installments) Where earnings available for debt services are EBITDA or EBIT based on the case. Purpose: -Yesterday,we d
See MoreCA Aspirant|Content ... • 23d
Daily dose of financial ratios by Anirudh Gupta Quick ratio: =Quick assets/Current liabilities Where quick assets means, (current assets-inventory) Purpose: -Unlike the current ratio (as we have discussed in the previous post), the quick ratio s
See MoreCA Aspirant|Content ... • 27d
Daily dose of financial ratios by Anirudh Gupta Debt/equity ratio =Total debt/Shareholders equity Purpose: It helps users of financial statements understand how much debt the company is using for every ₹1 of equity invested by shareholders. Cred
See MoreDownload the medial app to read full posts, comements and news.