RatioAnalysisFormulasSheet.xlsx

Published by at March 30, 2022

Ratio Analysis Formula

Ratio Analysis Formula Sheet
Group 1: Profitability Ratios
1- Gross Profit Margin =	Gross Profit	* 100
	Sales revenue
2- Operating Profit Margin =	Operating Profit	* 100
	Sales revenue
3- Return on Capital Employed =	Profit before interest and tax	* 100
	Capital Employed
Group 2: Liquidity Ratios
1- Current Ratio (Working Capital Ratio) =	Current Assets
	Current Liabilities
2- Acid Test Ratio (Quick Ratio) =	Current Assets – Inventory
	Current Liabilities
Group 3: Efficiency Ratios
1- Inventory Turnover =	Inventory	* 365 days
	Cost of Sales
2- Trade Receivables Turonver =	Trade Receivables	* 365 days
	Revenue
3- Trade Payables Turnover =	Trade Payables	* 365 days
	Cost of Sales
Group 4: Financial Gearing Ratios
1- Gearing Ratio =	Long term debts	* 100
	Capital Employed
2- Interest Coverage =	Operating Profit
	Interest Payable
Group 5: Investor Ratios
1- Dividend Payout Ratio =	Dividends announced for the year	* 100
	Profit after tax
2- Dividend Cover Ratio =	Profit after tax
	Dividend announced for the year
3- Dividend per Share =	Dividend announced for the year
	Number of ordinary shares in issue
4- Dividend Yield Ratio =	Dividend per share	* 100
	Market price per share
5- Earnings Per Share =	Profit after tax – Preference dividend
	Number of ordinary shares in issue
6- Price Earning (P/E) Ratio =	Market Price per share
	Earning per share