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    MS 3412-3

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    CPA
    This document discusses various financial ratios that can be used to analyze a company's performance and financial position. It provides guidance on which income figure to use in different contexts, such as return on assets or return on equity. It also lists other meaningful ratios that can evaluate long-term financial stability and efficiency, such as fixed asset turnover and total asset turnover.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    MS 3412-3

    Uploaded by

    CPA
    49 views1 page
    This document discusses various financial ratios that can be used to analyze a company's performance and financial position. It provides guidance on which income figure to use in different contexts, such as return on assets or return on equity. It also lists other meaningful ratios that can evaluate long-term financial stability and efficiency, such as fixed asset turnover and total asset turnover.

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    MAS

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    This document discusses various financial ratios that can be used to analyze a company's performance and financial position. It provides guidance on which income figure to use in different contexts, such as return on assets or return on equity. It also lists other meaningful ratios that can evaluate long-term financial stability and efficiency, such as fixed asset turnover and total asset turnover.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    49 views1 page

    MS 3412-3

    Uploaded by

    CPA
    This document discusses various financial ratios that can be used to analyze a company's performance and financial position. It provides guidance on which income figure to use in different contexts, such as return on assets or return on equity. It also lists other meaningful ratios that can evaluate long-term financial stability and efficiency, such as fixed asset turnover and total asset turnover.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    rl"->(! i/'"- {o,,we.+, .jJ"nnd of A".-^^7*,.

    *7 MAS-12
    f:iNAnl(-"]l\l !i rA f E'Mf:N-l' Al\AtYSIS

    " il:'.1 i t.)i: FRQ{IIA*IJI"J'ilY

    l:leiLtrfi on $ttIt-:: I!!-oin,e,


    Net Sales
    i

    Iltllr"rrrr r:n Assets .ltlcqry:q


    Average Assets

    lssi.ie r',1-r.ii. IIJCOMI fiqLire sirorrld be i-rs*d?


    * Ii'llte rnlsrrtion is t<.: i'ntasi-rre ap,erat'ianal perfrtrmar?ce, income is expressed as,i?.9&Ig_u,t,!g{$qt*AlE-Jax;
    aiterrtetiveiy, irrcr:rrrr bqfqrplAftgr;;XaXl.ilt,e_IgF[ may be used to exclude the effect of capitai structure.
    . If tite inteilt.ion is lo evaluate total rnanagerial effort, income is expressed aftqf inte!'gSt and tax.
    , '!
    ire fJractice ol i:xrrressrrg ir)corn(l ?flig.r.ln,te-Ig1l .pq,t-b-elqrcjg; is now rarely applied in business.
    n Irr{cLnre shoLrl<l irrcltrr-ir: c.livrdends and interest earned if the said investments are included in asset base"
    n If useri in the contexl: of "DuPont" technique, then income must be expressed a&e-fjnle.rc_sts-taxesgnd
    preier red stA!-k dlyidg[]!!,!.

    --. Rerturn on Sales x Assets Turnover.x Equity Multiplierj


    L'r-,y,:r,,1,::::
    Irlqsryla
    llr:tt.L rrt tt n t:t1 ts itt7
    Average Equity

    ir'drrlillqr f:'er 5lta rt: r Nqt l,r'rcqrtle_: P,relerrqd-Diyl{eld-s


    I lVtct Ave. Cornmon Shares Outstanding

    MARKET :f {; II:
    ..'l
    ;,i r.e p_qr
    SiLare It indicates the number of pesos
    :;'.-:.gS Pg: Share required to buy P 1 of earnings
    i
    I

    -
    Mejsures-tt-,u ,aie-of returl in t[J]
    Dtt,tdend I teld -,, , iCe:r(i Per Share
    . investor's common stock
    i
    i!lyes!Ug!ti:- .. . ...
    ;..ti.'i, (.)iii Dlvidqld pqr Share : It indicates the proportron
    ,r /j'.ir
    i, arnings Per Share earnings distributed as dividends

    OTHER MEANINGFUL RATIOS


    o i.'.i: r,)-., |;SIi-) i(,\ iVALUA./-L- LONG-Tt.R!"1 f'INANCIAL POSITION OR STABILITY
    ll"air."s
    It"-----'--- ine propo.tion of
    oixqd Ass'ets I owners', equity to fixed assets'
    ;
    i
    i:'ireri4:<;sers kt [<tt,t! [cluriy , raiJ Eq;iry I lxj::?l,,::.
    of
    byou":*#,
    ,,,j;J
    i -l
    i I /Ar^!\
    Acca+. (Net)
    tri*a; Assets lI ,--r;--+^-
    r .Ai reri l1ssr,l.s rc; l.tttatlsri,rr,
    ! \)ta! /1r1''t:
    Fixed tndicates possible
    ^^--ilr^ over-expansion
    ^..
    L _ Total Asseis I of plant and equipment
    I - - .i ..,....-. -.- I
    | -

    I -.;.,i u ,, t t) !: r t e{1A.sso' rs , saies


    ruet
    roughly the efficiency of
    Tests
    Ilff---^^,-^^r
    lurnover) II |i rrrorr€gcrrrcrrl rrr l-,-^^:^^ pldlll
    plant
    Ksei,rrrg -.1--!
    I I i-

    iir - ir)iant lurrlOver'}


    i{)ittrlt Fixed trnret;
    [ssers (Net)
    ri*eci ASSetS
    I iliiffl":j -,'l -,keeping
    .,ProPerti-esemPloY-e-d. -
    I , I Measures recoverable amouni-_uv
    I fl,','L u'..rlut.'Pt'r "$/r.:rE: I Cqnm-ql.Stiereho,LdeGl Egui-ty I common stockholders in the event
    ("on)tnor) $lor1<
    acr,rlr;nr:n $rc.,e"( , i;;i*;";Gr*i"ffiitr;;id
    Conrmon Shares Outstanding ;';;;;;;;';';;;'r.-"r.",'r"i
    i of liquidation if assets are realized
    :t-.----.- I at their book values
    t"
    'ti*tes prefr:rred !)ivirt*rri {:;ttrt:rl I
    ,

    N*rt-I?sqiaa
    preferred Dividends
    jftei l1:"t i :i"'Jixff*t "?l't', o.[|:#;
    ij slgc-blolqclS: - _
    II ,ni.rr Acca*c Measures efficiency of the firm to
    c.r1-ril;:l Inler;slry /tailrr r
    Istal-4,559!$
    Net $aies i generate
    laleqthrough
    -

    i ,,,,..,", r,",r,i t h-t,t,,< r.:a.t-t,t Net lnceme bgfclre t4xes & fixed ctlarqes I Measures abillty to meet fixed
    ' (/( *: L(Jr I't(:u (Fixerl < harqes + sinking furrd payment)** j charges.
    il,r
    'Tr;rdinq nn the eqr.rity'is *noitjei name foi teGraaa:'.-
    i:ixt."tl charqes i;h;r1l ir;e.lr"lde r*nt, inteiests and other relevant.fixed exFlenses; sinking fund payment
    fltL.rlt lre cxl)rc-.:;seil ilrFor{i Iax^

    PaqeSofSpaoes "td.r
    ; /&s{\ 1

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