Ratios
What is Sacrificing Ratio?
Meaning and Explanation
Sacrificing ratio is the proportion in which old partners of a firm forego their share of profits in favour of new partner(s)....
What is Gaining Ratio?
Meaning and Explanation
The gaining ratio is the proportion in which one or more partners gain a share in the firm's profit as a result...
Types of Accounting Ratios
Accounting Ratios
There are mainly 4 different types of accounting ratios to perform a financial statement analysis; Liquidity Ratios, Solvency Ratios, Activity Ratios and Profitability...
What is Operating Profit Ratio?
Operating Profit Ratio
Operating profit ratio establishes a relationship between operating Profit earned and net revenue generated from operations (net sales). operating profit ratio is a...
What is Net Profit Ratio?
Net Profit Ratio
Also known as Net Profit Margin ratio, it establishes a relationship between net profit earned and net revenue generated from operations (net sales)....
What is Gross Profit Ratio?
Gross Profit Ratio
Also known as the Gross Profit Margin ratio, it establishes a relationship between gross profit earned and net revenue generated from operations...
What is Working Capital Turnover Ratio?
Working Capital Turnover Ratio
Working Capital Turnover Ratio is used to determine the relationship between net sales and working capital of a business. It shows the number...
What is Creditor’s Turnover Ratio?
Creditor's Turnover Ratio or Payables Turnover Ratio
Creditor's turnover ratio is also known as Payables Turnover Ratio, Creditor's Velocity and Trade Payables Ratio. It is an activity...
What is Debtor’s Turnover Ratio?
Debtor’s Turnover Ratio or Receivables Turnover Ratio
Debtor's turnover ratio is also known as Receivables Turnover Ratio, Debtor's Velocity and Trade Receivables Ratio. It is an...
What is Stock Turnover Ratio?
Stock Turnover Ratio
The inventory turnover ratio or stock turnover ratio indicates the relationship between "cost of goods sold" and "average inventory". It indicates how...
What is Interest Coverage Ratio?
Interest Coverage Ratio
Interest Coverage ratio is a type of solvency ratio (long-term solvency) which is derived by dividing "Earnings before Interest and Taxes" of...
What is Fixed Assets Ratio?
Fixed Assets Ratio
The fixed Assets ratio is a type of solvency ratio (long-term solvency) which is found by dividing the total fixed assets (net)...
What is Operating Cash Flow Ratio?
Operating Cash Flow Ratio
Operating cash flow ratio also known as cash flow from operations ratio is calculated by dividing cash flow from operations by current...
What is Proprietary Ratio?
Proprietary Ratio
This ratio shows the proportion of total assets of a company which are financed by proprietors' funds. The proprietary ratio is also known...
What is Debt to Equity Ratio?
Debt to Equity Ratio
Debt to equity ratio shows the relationship between a company's total debt with its owner's capital. It reflects the comparative claims...
What is Debt to Asset Ratio?
Debt to Asset Ratio
It is also called debt to total resources ratio or only debt ratio. The debt to asset ratio measures the percentage...
What is Acid Test Ratio?
Acid Test Ratio
Acid Test Ratio/Liquid Ratio/Quick Ratio is a measure of a company’s immediate short-term liquidity. It is calculated by dividing liquid assets by...
What is Super Quick Ratio?
Super Quick Ratio or Cash Ratio
This ratio goes one step ahead of current ratio, liquid ratio & is calculated by dividing super quick assets by...
What is Current Ratio?
Current Ratio
The current ratio is a type of liquidity ratio which is established by dividing total current assets of a company with its total...