Commodities Market Updates

Monday, August 15, 2011

Important Ratios


Other Ratios


Liquidity Ratio:



Current Ratio:
                             Current Assets
                             ---------------------
                             Current Liabilities



Quick Ratio:
Current Assets-(Inventory + Prepaid Expenses)
                             ---------------------------------------------
                             Current Liabilities



Cash Ratio:
                             Cash + Marketable Securities
                             --------------------------------
                             Current Liabilities






Asset Turnover Ratios:


Debtors Turnover Ratio:
                                      Credit Sales
                                      -------------------
                                      Average Debtors



Average collection period:
                                                No. of Days in the year (365 days)
                                                ---------------------------------
                                                     Debtors Turnover Ratio


Inventory Turnover Ratio:
                                                Cost of goods sold
                                                -------------------
                                                Average Inventory

Note: In case, cost of goods sold is not available then sales will be taken in the place of cost of goods sold.


Inventory Period:
                                      365 days
                                      ----------
                                      Inventory Turnover


Creditors Turnover Ratio:

                                      Credit Purchases
                                      -----------------------
                                      Average Creditors


Payments Period:
                                      365 days
                                      -------------------------
                                      Creditors Turnover Ratio

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