RATIO FORMULA SHEET
Liquidity Ratios:  
1.  Current Ratio  Current Assets/Current Liabilities
(Current AssetsInventory)/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  Longterm debt/Stockholders’ Equity + longterm debt 
17.  Interest Coverage  (Income Before Income Taxes + Interest Expense)/Interest Expense 
18.  Leverage /  Gearing Ratio 
19.  Gearing  (Longterm 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 ActivitiesDividendsNet 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