A/AS Level Business Studies - Chapter 32 - Analysis of Published Accounts (A-Level only)
Gearing ratio
(long-term loans/capital employed) x 100
Return on capital employed (%)
(net or operating profit/capital employed) x 100
Days' sales in receivables ratio
accounts receivable x 365/sales turnover
Inventory (stock) turnover ratio
cost of goods sold/value of inventories
Prince/earnings ratio
current share price/earnings per share
Dividend yield ratio (%)
dividend per share x 100/current share price
Dividend cover ratio
profit after tax and interest/annual dividends
Earnings per share
profit after tax/total number of shares => this is the amount of profit earned per share
Share price
the quoted price of one share on the stock exchange
Dividend
the share of the company profits paid to shareholders
Capital employed
the total value of all long-term finance invested in the business. It is equal to (non-current assets + current assets) - current liabilities OR non-current liabilities + shareholders' equity
Dividend per share
total amount dividends/total number of issued shares