Accounting Ratios

Current Ratio = Current Assets : Current Liabilities or Current Assets/Current Liabilities

Quick Ratio = Quick Assets : Current Liabilities or Quick Assets/Current Liabilities

Debt-Equity Ratio = Long-term Debts/Shareholders' Funds

Debt to Capital Employed Ratio = Long-term Debt/Capital Employed (or Net Assets)

Proprietary Ratio = Shareholders' Funds/Capital employed (or net assets)

Total Assets to Debt Ratio = Total assets/Long-term debts

Interest Coverage Ratio = Net Profit before Interest and Tax/Interest on long-term debts

Inventory Turnover Ratio = Cost of Revenue from Operations/Average Inventory

Trade Receivable Turnover ratio = Net Credit Revenue from Operations/Average Trade Receivable

Average collection period = Number of days or months in a year/Trade Receivables Turnover Ratio

Trade Payables Turnover ratio = Net Credit purchases/Average trade payable

Average payment period = No. of days/month in a year/Trade Payables Turnover Ratio