Analysis of Financial Statements (Grade 10 NSC Matric Accounting): Flashcards
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Purpose of financial ratios
Purpose of financial ratios
Tools to measure business health/performance
Five steps in ratio analysis
Five steps in ratio analysis
Identify, Gather, Perform, Compare, Analyse & Interpret
Gross profit on turnover formula
Gross profit on turnover formula
(Gross profit × 100) / Turnover
Gross profit on cost of sales formula
Gross profit on cost of sales formula
(Gross profit × 100) / Cost of sales
Current ratio formula
Current ratio formula
Current assets : Current liabilities
Acid test ratio formula
Acid test ratio formula
(Current assets - Inventories) : Current liabilities
Solvency ratio formula
Solvency ratio formula
Total assets : Total liabilities
Debt/equity ratio formula
Debt/equity ratio formula
Non-current liabilities : Owners' equity
Return on investment formula
Return on investment formula
(Net profit × 100) / Average owners' equity
Liquidity vs solvency difference
Liquidity vs solvency difference
Liquidity: short-term debts; Solvency: long-term obligations