Financial Ratio

Net Income
Return on Sales (ROS) =
1 Sales
Measure management's ability to control expenses

COGS
COGS/Sales =
2 Sales
Measure management's ability to control inventory cost

Opex
Opex/Sales =
3 Sales
Measure management's ability to control operating expenses

Beginning Asset + Ending Asset

4 Average Assets =
2

Sales
Asset Turnover =
5 Average Assets
Measure efficiency of assets in producing sales… marketing effectiveness

Net Income
Return on Assets (ROA) =
6 Average Assets
Measure efficiency of using assets to produce profit

Average Assets
Financial Leverage =
7 Average Equity (Beginning Equity + Ending Equity)/2
Measures how much you're leveraging the equity using OPM

Net Income
Return on Equity (ROE) =
8 Average Equity (Beginning Equity + Ending Equity)/2
Measure the economic rewards accruing the shareholders as a result of the company's transactions

Total Debt
Debt to Equity =
9 Total Equity
Measure the mix of debt vs. shareholders in financing the company

Cash + Account Receivable

Quick Ratio =
10 Account Payable + Other Current Liabilities
A measure of a company's ability to cover its current liabilities from only cash

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Financial Ratio

Total Current Asset

Current Ratio =
11 Total Current Liabilities
A measure of a company's ability to cover all short term obligations with existing short term resources

Sales
Fixed Asset Turnover =
12 Average Net Fixed Assets
Measure how effectively the fixed assets of the business are at producing assets

Earnings
ROA Employees =
13 No of Employee
Measure efficiency of employees to produce profits

Earnings
ROA Payroll =
14 Total Payroll
Measure efficiency of payroll to produce profits

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