RATIO FORMULA SHEET
| Liquidity Ratios: | ||
| 1. | Current Ratio | Current Assets/Current Liabilities
(Current Assets-Inventory)/Current Liabilities |
| 2. | Quick Ratio | |
| Activity /Efficiency Ratios | ||
| 3. | Receivables/(Debtors) Turnover | Sales/ Accounts Receivables |
| 4. | Debtors Collection period/or Average Collection period | Days in Year (360)/Receivables Turnover or debtors/sales x 360 |
| 5. | Payables Turnover | (Cost of Goods Sold + /- Change in Inventory)/Average Accounts Payable |
| 6. | Days Payable Outstanding/ or Creditors Payment period | Days in Year (360)/Payables Turnover or payables/purchases x 360 |
| 7. | Inventory Turnover | Cost of Goods Sold/ Inventory |
| 8. | Average days inventory on hand | Days in Year (360)/Inventory Turnover |
| 9. | Asset Turnover | Sales/ Total Assets |
| Profitability Ratios | ||
| 10. | Gross profit margin | Gross profit/sales |
| 11. | Net Profit Margin | Net Income / Sales |
| 12. | Operating profit margin | Operating Income / Sales |
| 13. | Return on Assets | Net Income/ Total Assets |
| 14. | Return on Equity | Net Income/ Stockholders’ Equity |
| 15. | Return on Capital employed (ROCE) | Profit before interest & taxes (PBIT / capital employed) x 100
|
| Solvency / | Long term debt ratios | |
| 16. | Debt ratio | Long-term debt/Stockholders’ Equity + long-term debt |
| 17. | Interest Coverage | (Income Before Income Taxes + Interest Expense)/Interest Expense |
| 18. | Leverage / | Gearing Ratio |
| 19. | Gearing | (Long-term Loans + Preference Shares)/Ordinary Shareholders’ Equity |
| Cashflow Ratios | ||
| 20. | Cash Flow Yield | Net Cash Flow from Operating Activities/Net Income |
| 21. | Cash Flow to Sales | Net Cash Flow from Operating Activities/ Net Sales |
| 22. | Cash Flow to Assets | Net Cash Flow from Operating Activities/Total Assets |
| 23. | Free Cash Flow | Net Cash Flow from Operating Activities-Dividends-Net Capital Expenditure |
| Investment/ Stock Market Ratios | ||
| 24. | Earnings Per Share (EPS) | Profit after Tax – Pref. Div./# of Ord. Shares in Issue |
| 25. | Price Earnings Ratio (P/E) | Market Price per Share/Earnings per Share |
| 26. | Dividends Yield | Dividends per Share/Market Price per Share |
Using the category of ratios as outlined in the Ratio Formula Sheet, attached, conduct a DETAILED analysis of the company your group has chosen over the past two (2) financial years, by preparing an excel spread sheet of ratios
- Where restated figures from the financial statements are available, they should be used. (Some financial statements as well as other company information can be obtained from jamstockex.com by selecting Listed Companies or can be obtained from the companies).
- Prepare a commentary on your findings regarding the performance of the company.
The company selected is Berger Paints ltd. Jamaica
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