Assigment # 2a

Shaheed Zulfikar Ali Bhutto Institute of
Sciences & Technology
Introduction to Business Finance

Assignment # 3
Submitted to
Syed Farhan Sheikh
Submitted by
Salma Omer
0926115
MBA D 2 A
D.G.Khan Cement Company Limited
Financial Statement Analysis

Sr. Ratios Formulas Computation Computation Results of Results of
No. for for Year 2009 Year 2008
Year 2009 Year 2008
1. Current Ratio Total Current 13287592000 19202591000 0.8391 x 1.59295 x

Asset/Total / /
Current 15834799000 12054718000
Liabilities
2. Quick Ratio Cash + (243842000 + ( 226372000 0.07274 x 0.083679 x
Govt.Security 908100000 ) / + 782358000)
Receivables / 15834799000 /
Total Current 12054718000
Liability
3. Net Worth Total Assets – 42723041000 51992934000 Rs. Rs.
Total Liabilities - - 21191442000 30080257000
21531599000 21912677000
3. Leverage Total Liabilities 21531599000 21912677000 1.01605 x 0.72847 x

Ratio / Net Worth / /
21191442000 30080257000
4. Gross Margin Gross Profit / 5679730000 / 1915273000 / 0.31487 x 0.15388 x

Ratio Net Sales 18038209000 12445996000
5. Net Profit Net Profit / Net 525581000 / (53230000) / 0.029137 x ( 0.004276 ) x
Margin Ratio Sales 18038209000 12445996000
6. Inventory Cost of Good 12358479000 10530723000 13.73414 x 23.6191 x
Turn Over Sold / / 899836000 / 445856000
Ratio Inventory
7. Accounts Net Credit 908100000 / 782358000 / 2487945.2054 2143446.5753
Receivable Sales / 365 365 365 x x
Turn Over Days
Ratio
8. Return On Net Profit / Net 525581000 / (53230000) / 0.02480 x (0.001769) x
Investment Worth 21191442000 30080257000
(ROI)
Return on Net Profit / 525581000 / (53230000) / 0.01230 x (0.001023) x
9. Assets (ROA) Total Asset 42723041000 51992934000
Kohat Cement Company Limited
Sr. Ratios Formulas Computation Computation Results of Results of

No. for for Year 2009 Year 2008
Year 2009 Year 2008
1. Current Ratio Total Current 1645675393 / 1332629006 / 0.5585 x 0.6608 x

Asset/Total 2946392234 2016497901
Current
Liabilities
2. Quick Ratio Cash + ( 34371413 + ( 36994967 + 0.2195 x 0.2196 x
Govt.Security 612373810 ) / 406020470 ) /
Receivables / 2946392234 2016497901
Total Current
Liability
3. Net Worth Total Assets – 8624894242 - 7623920500 - Rs. Rs.
Total Liabilities 6353347077 5294791353 2271547165 2329129147
4. Leverage Total Liabilities 6353347077 / 5294791353 / 2.7969 x 2.2732 x

Ratio / Net Worth 2271547165 2329129147
5. Gross Margin Gross Profit / 804559290 / 87401851 / 0.2369 x 0.0637 x

Ratio Net Sales 3395580759 1371791931
6. Net Profit Net Profit / Net 27092698 / (222439366) / 0.00797 x (0.16215) x
Margin Ratio Sales 3395580759 1371791931
7. Inventory Cost of Good 2591021469 / 1284390080 / 18.6011 x 7.3680 x
Turn Over Sold / 139293693 174317806
Ratio Inventory
8. Accounts Net Credit 612373810 / 406020470 / 1677736.4657 1112384.8493
Receivable Sales / 365 365 365 x x
Turn Over Days
Ratio
9. Return On Net Profit / Net 27092698 / (222439366) / 0.0119 x 0.0955 x
Investment Worth 2271547165 2329129147
(ROI)
Return on Net Profit / 27092698 / (222439366) / 0.00314 x 0.02917 x
10. Assets (ROA) Total Asset 8624894242 7623920500
D.G. Khan Cement Company Limited
Comparison of Ratios for the Year 2008 & 2009
1. Current Ratio
Current ratio = Total Current Assets ÷ Total Current Liabilities

1. Current Ratio
1.8
1.59295
1.6
1.4 Year
1.2
1 0.8391 2009
0.8 2008
0.6
0.4
0.2
0
1
DGKC
Interpretation Current Ratio:
Current ratio of DGKhan Cement in 2009 is less than that in 2008. This means that
either total current assets have decreases in 2009 or the total current liabilities have
increased from 2008 to 2009. decreased current ratio is not a good sign for any
company as current assets cant meet currents liabilities.
2. Quick Ratio
Quick Ratio = (Cash + Govt. Securities + Receivables) ÷ Total Current Liabilities

2. Quick Ratio
0.086
2008, 0.083679
0.084
0.082 Year
0.08
0.078
2009
0.076
2009, 0.07274 2008
0.074
0.072
0.07
0.068
0.066
1 DGKC
Interpretation Quick Ratio:
Quick ratio of D.G.Khan Cement in 2009 is less than that in 2008. This means that
either total liquid assets have decreases in 2009 or the total current liabilities have
increased from 2008 to 2009. Decreased current ratio is not a good sign for any
company as their liquid assets cant meet currents liabilities.
3. Net Worth
Net Worth = Total Assets – Total Liabilities
3. Net Worth
Rs.
35000000000 2008,
30080257000
30000000000
Year
25000000000
20000000000 2009
2009, 2008
15000000000
21191442000
10000000000
5000000000
0
1 2
DGKC
Interpretation Net Worth :
Net Worth of D.G.Khan Cement in 2009 is less than that in 2008. After going though
the values we find that total Liabilities have decreased in 2009 but assets also have
decreased considerably. Decreased net worth is not a good sign for any company.
4. Leverage Ratio
Leverage Ratio = Total Liabilities ÷ Net Worth

4. Leverage Ratio
1.2
1
Year
Year
2008, 0.72847
0.8
2009
0.6
2009, 1.01605 2008
0.4
0.2
0
1 DGKC 2
Interpretation Leverage Ratio:
Leverage ratio of D.G.Khan Cement in 2009 is more than that in 2008. having a
smaller value of leverage ratio is good for any company. So an increased leverage
ratio in 2009 is not a good sign for DQ Khan Cement Company. This shows the
extent that debt is used in a company's capital structure
5. Gross Margin Ratio
Gross Margin Ratio = Gross Profit / Net sales

x
0.35
0.3
0.25 Year
0.2 2009
2009, 0.31487 2008, 0.15388
0.15 2008
0.1
0.05
0
DGKC
1
Interpretation Gross Margin Ratio:
Gross Margin ratio of D.G.Khan Cement in 2009 is more than that in 2008. In this
case Gross profit has increased considerably in one year. This is a good sign for
D.G.Khan Cement Company. Having more gross margin ratio means it was more
profitable.
6. Net Profit Margin Ratio
Net Profit Margin Ratio = Net Profit / Net Sales

x
0.035
0.03
0.025
Year
0.02
0.015 2009
2009, 0.029137
0.01 2008
0.005
0
-0.005 1
2008, -0.004276
-0.01 DGKC
Interpretation of Net Profit Margin Ratio:
Net Profit Margin ratio of D.G.Khan Cement in 2009 is more than that in 2008. In
this case net profit has increased considerably in one year. This is a good sign for
D.G.Khan Cement Company. Having more net profit margin ratio means it was more
profitable.
7. Inventory Turnover Ratio
Inventory Turnover Ratio = Cost of Goods Sold / Inventory

Interpretation of Inventory Turnover Ratio:
Inventory Turnover ratio of D.G.Khan Cement in 2009 is less than that in 2008. In
this case net profit has increased considerably in one year. A higher value of
inventory ratio means that the company is efficiently managing and selling its
inventory. If a company has a low inventory turnover ratio, then there is a risk they
are holding old inventory which will be difficult to sell. This is not a good sign for
D.G.Khan Cement Company.
8. Accounts Receivable Turnover Ratio
Accounts Receivable Turnover Ratio = Net Credit Sales / 365 (days)
Rs.
Year
DGKC
Interpretation of Accounts Receivable Turnover Ratio:
If accounts Receivable Turnover Ratio is high then this means customers are paying their
bills in time and this is a good sign for any org. so in 2009 Accounts Receivable Turnover
Ratio has increased.
9. ROI (Return on Investment)
ROI = Net Profit / Net Worth
DGKC
Interpretation of ROI:
ROI has increased in 2009 this means the company is utilizing its equity investment
efficiently.
10. ROA (Return on Assets)
ROA = Net Profit / Total Assets
Kohat Cement
DGKC
Interpretation of ROA:
The higher the return on assets ratio, the more efficiently the company is using its asset
base to generate sales. Since DG Khan Cement has a higher ROA in 2009 it is a good
sign.
COMPARISON OF RATIOS FOR THE YEAR 2008 & 2009
1. Current Ratio

1. Current Ratio
0.68 0.6608
0.66
0.64 Year
0.62
2009
0.6
2008
0.58
0.5585
0.56
0.54
0.52
0.5
Kohat
1 Cement
Current ratio of Kohat Cement in 2009 is less than that in 2008. This means that
either total current assets have decreases in 2009 or the total current liabilities have
increased from 2008 to 2009. decreased current ratio is not a good sign for any
company as current assets cant meet currents liabilities.
2. Quick Ratio
2. Quick Ratio
0.21962
0.2196
0.2196
0.21958 Year
0.21956
2009
0.21954
2008
0.21952
0.2195
0.2195
0.21948
0.21946
0.21944
1
Kohat Cement
Quick ratio of Kohat Cement in 2009 is less than that in 2008. This means that either
total liquid assets have decreases in 2009 or the total current liabilities have increased
from 2008 to 2009. Decreased current ratio is not a good sign for any company as
their liquid assets can’t meet currents liabilities.
3. Net Worth
3. Net Worth
2340000000 2329129147
2330000000
2320000000
Year
2310000000
2300000000 2009
2290000000 2008
2280000000 2271547165
2270000000
2260000000
2250000000
2240000000
Kohat Cement
1
Net Worth of Kohat Cement in 2009 is less than that in 2008. After going though the
values we find that total Liabilities have decreased in 2009 but assets also have
decreased considerably. Decreased net worth is not a good sign for any company.
4. Leverage Ratio
4. Leverage Ratio
3 2.7969
2.5 2.2732
Year
2
2009
1.5 2008
0.5
0
Kohat Cement
1
Leverage ratio of Kohat Cement in 2009 is more than that in 2008. Having a smaller
value of leverage ratio is good for any company. So an increased leverage ratio in
2009 is not a good sign for Kohat Cement Company. This shows the extent that debt
is used in a company's capital structure

0.25 0.2369
0.2 Year
0.15 2009
2008
0.1
0.0637
0.05
0
Kohat Cement
1
Gross Margin ratio of Kohat Cement in 2009 is more than that in 2008. In this case
Gross profit has increased considerably in one year. This is a good sign for Kohat
Cement Company. Having more gross margin ratio means it was more profitable.

0.02 0.00797
0
-0.02 1
-0.04 Year
-0.06 2009
-0.08 2008
-0.1
-0.12
-0.14
-0.16
-0.18 -0.16215 Kohat Cement
Net Profit Margin ratio of Kohat Cement in 2009 is more than that in 2008. In this
case net profit has increased considerably in one year. This is a good sign for Kohat
Cement Company. Having more net profit margin ratio means it was more profitable.

20 18.6011
18
16
14 Year
12 2009
10 2008
7.368
8
6
4
2
0
Kohat 1Cement
Inventory Turnover ratio of Kohat Cement in 2009 is more than that in 2008. A
higher value of inventory ratio means that the company is efficiently managing and
selling its inventory. If a company has a low inventory turnover ratio, then there is a
risk they are holding old inventory which will be difficult to sell. This is a good sign
for Kohat Cement Company.

8. Accounts Receivable Turnover
1800000 Ratio
1677736.466
1600000
1400000 Year
1200000 1112384.849
2009
1000000
2008
800000
600000
400000
200000
0
Kohat Cement
1
If accounts Receivable Turnover Ratio is high then this means customers are paying their
bills in time and this is a good sign for any org. so in 2009 Accounts Receivable Turnover
Ratio has increased.

0.12
0.1 0.0955
Year
0.08
2009
0.06 2008
0.04
0.02 0.0119
0
Kohat 1Cement
ROI has decreased in 2009 this means the company is not utilizing its equity investment
efficiently.

10. ROA
0.035
0.02917
0.03
Year
0.025
2009
0.02
2008
0.015
0.01
0.005 0.00314
0
Kohat1 Cement
base to generate sales. Since Kohat Cement has a lower ROA in 2009 it is not a good
sign.

&
D.G. Khan Cement Company Limited
Comparison of Ratios for the Year 2008
1. Current Ratio

1. Current Ratio
1.8
Year 2008
1.59295
1.6
1.4 Kohat Cement
1.2 Company Limited
1
D.G.Khan Cement
0.8 0.6608 Company Limited
0.6
0.4
0.2
0
1
Current ratio of DG Khan Cement is more than that of Kohat Cement in 2008. Lower
current ratio is not a good sign for Kohat Cement as D.G. Khan Cement has higher
current ratio. This means D.G. Khan Cement’s current assets can meet currents
liabilities efficiently than Kohat cement can.
2. Quick Ratio
2. Quick Ratio
0.25
0.2196 Year 2008
0.2
Kohat Cement
Company Limited
0.15
D.G.Khan Cement
0.05
0
1
Quick ratio of DGKC is less than that of Kohat Cement in 2008. Lower Quick ratio is
not a good sign for D.G. Khan Cement. This means Kohat Cement’s liquid assets can
meet currents liabilities efficiently than D.G. Khan Cement can.
3. Net Worth
3. Net Worth
Rs.
35000000000
30080257000 Year 2008
30000000000
Kohat Cement
25000000000
Company Limited
20000000000
D.G.Khan Cement
15000000000 Company Limited
10000000000
5000000000 2329129147
0
1
Net Worth of D.G.Khan Cement is greater than that of Kohat Cement in 2008.
Decreased net worth is not a good sign for any company. So D.G. Khan Cement is
more reliable in terms of net worth than Kohat cement.
4. Leverage Ratio
4. Leverage Ratio
2.5 2.2732
Year 2008
2
Kohat Cement
Company Limited
1.5
D.G.Khan Cement
1 Company Limited
0.72847
0.5
0
1
Leverage ratio of D.G.Khan Cement is less than that of kohat cement in 2008. Having
a smaller value of leverage ratio is good for any company. So an increased leverage
ratio is not a good sign for Kohat cement Company. So D.G. Khan Cement is more
reliable in terms of Leverage Ratio than Kohat cement.

0.18
0.15388
0.16
0.14 Kohat Cement
0.12 Company Limited
0.1
D.G.Khan Cement
0.06
0.04
0.02 Year 2008
0
1
Gross Margin ratio of D.G.Khan Cement is more than that of Kohat cement in 2008.
This is a good sign for D.G.Khan Cement Company. Having more gross margin ratio
means it was more profitable. So D.G. Khan Cement is more reliable in terms of
Gross Margin Ratio than Kohat cement.

0
-0.02 1 -0.004276
-0.04
Kohat Cement
-0.06 Company Limited
-0.08
D.G.Khan Cement
-0.1 Company Limited
-0.12
-0.14 Year 2008
-0.16
-0.16215
-0.18
Net Profit Margin ratio of D.G.Khan Cement in 2009 is more than that of Kohat
Cement in 2008. This is a good sign for D.G.Khan Cement Company. Having more
net profit margin ratio means it was more profitable. So D.G. Khan Cement is more
reliable in terms of Net Profit Margin Ratio than Kohat cement.

25 23.6191
20 Kohat Cement
Company Limited
15
D.G.Khan Cement
10 Company Limited
7.368
5
Year 2008
0
1
Inventory Turnover ratio of D.G.Khan Cement is more than that of Kohat cement in
2008. A higher value of inventory ratio means that the company is efficiently
managing and selling its inventory. If a company has a low inventory turnover ratio,
then there is a risk they are holding old inventory which will be difficult to sell. So
D.G. Khan Cement is more reliable in terms of Inventory Turnover Ratio than Kohat
cement.

2500000
Ratio
2143446.575
2000000 Kohat Cement
Company Limited
1500000
1112384.849 D.G.Khan Cement
500000 Year 2008
0
1

If accounts Receivable Turnover Ratio is high then this means customers are paying
their bills in time and this is a good sign for any org. So D.G. Khan Cement is more
reliable in terms of Accounts Receivable Turnover Ratio than Kohat cement.

9. ROI
0.12
0.0955
0.1
Kohat Cement
0.08
Company Limited
0.06
D.G.Khan Cement
0.02
Year 2008
0
1 -0.001769
-0.02
ROI has increased this means the company is utilizing its equity investment
efficiently. So D.G. Khan Cement is more reliable in terms of ROI than Kohat
cement.
10. ROA
0.035
0.02917
0.03
0.025 Kohat Cement
Company Limited
0.02
0.015 D.G.Khan Cement
Company Limited
0.01
0.005
Year 2008
0
-0.005 1 -0.001023
The higher the return on assets ratio, the more efficiently the company is using its
asset base to generate sales. So D.G. Khan Cement is more reliable in terms of ROA
than Kohat cement.
&
D.G.Khan Cement Company Limited
COMPARISON OF RATIOS FOR THE YEAR 2009
1. Current Ratio
1. Current Ratio
0.9 0.8391
0.8
0.7
Kohat Cement
0.5
D.G.Khan Cement
0.4 Company Limited
0.3
0.2
0.1
Year 2009
0
1
Current ratio of DG Khan Cement is more than that of Kohat Cement in 2009. Lower
current ratio is not a good sign for Kohat Cement as D.G. Khan Cement has higher
current ratio. This means D.G. Khan Cement’s current assets can meet currents
liabilities efficiently than Kohat cement can.
2. Quick Ratio

2. Quick Ratio
0.25
0.2195
0.2
Kohat Cement
Company Limited
0.15
D.G.Khan Cement
Company Limited
0.1
0.07274
0.05
Year 2009
0
1
Quick ratio of DG Khan Cement is less than that of Kohat Cement in 2009. This
means D.G. Khan Cement’s liquid assets can meet currents liabilities less efficiently
than Kohat cement can.
3. Net Worth
Rs. 3. Net Worth

25000000000
21191442000
20000000000
Kohat Cement
Company Limited
15000000000
D.G.Khan Cement
Company Limited
10000000000
5000000000
2271547165
Year 2009
0
1

Net Worth of D.G.Khan Cement is greater than that of Kohat Cement in 2009.
Decreased net worth is not a good sign for any company. So D.G. Khan Cement is
more reliable in terms of net worth than Kohat cement.
4. Leverage Ratio
4. Leverage Ratio
3 2.7969
2.5
Kohat Cement
2 Company Limited
1.5 D.G.Khan Cement

Company Limited
1.01605
1
0.5
Year 2009
0
1
Leverage ratio of D.G.Khan Cement is less than that of kohat cement in 2009. Having
a smaller value of leverage ratio is good for any company. So an increased leverage
ratio is not a good sign for Kohat cement Company. So D.G. Khan Cement is more
reliable in terms of Leverage Ratio than Kohat cement.

0.35
0.31487
0.3
0.25 0.2369 Kohat Cement

Company Limited
0.2
D.G.Khan Cement
0.1
0.05
Year 2009
0
1
Gross Margin ratio of D.G.Khan Cement is more than that of Kohat cement in 2009.
This is a good sign for D.G.Khan Cement Company. Having more gross margin ratio
means it was more profitable. So D.G. Khan Cement is more reliable in terms of
Gross Margin Ratio than Kohat cement.

0.035
0.029137
0.03
Kohat Cement
0.02
D.G.Khan Cement
0.01 0.00797
Year 2009
0.005
0
1
Net Profit Margin ratio of D.G.Khan Cement is more than that of Kohat Cement in
2009. This is a good sign for D.G.Khan Cement Company. Having more net profit
margin ratio means it was more profitable. So D.G. Khan Cement is more reliable in
terms of Net Profit Margin Ratio than Kohat cement.

20 18.6011
18
16
13.73414 Kohat Cement
14
Company Limited
12
10 D.G.Khan Cement
8 Company Limited
6
4
2
Year 2009
0
1
Inventory Turnover ratio of D.G.Khan Cement is less than that of Kohat cement in
2008. A higher value of inventory ratio means that the company is efficiently
managing and selling its inventory. If a company has a low inventory turnover ratio,
then there is a risk they are holding old inventory which will be difficult to sell. So
Kohat Cement is more reliable in terms of Inventory Turnover Ratio than D.G. Khan
cement.

3000000 Ratio
2487945.205
2500000
Kohat Cement
1677736.466
1500000 D.G.Khan Cement
Company Limited
1000000
500000 Year 2009

0
1

If accounts Receivable Turnover Ratio is high then this means customers are paying
their bills in time and this is a good sign for any org. So D.G. Khan Cement is more
reliable in terms of Accounts Receivable Turnover Ratio than Kohat cement.
9. ROI
0.03
0.0248
0.025
Kohat Cement
0.015 0.0119
D.G.Khan Cement
Company Limited
0.01
Year 2009
0.005
0
1
ROI has increased this means the company is utilizing its equity investment
efficiently. So D.G. Khan Cement is more reliable in terms of ROI than Kohat
cement.
10. ROA
0.014
0.0123
0.012
Kohat Cement
0.008
D.G.Khan Cement
0.004 0.00314
Year 2009
0.002
0
1
base to generate sales. So D.G. Khan Cement is more reliable in terms of ROA than
Kohat cement

Assigment # 2a

Încărcat de

Informații document

Descriere originală:

Titlu original

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

Assigment # 2a

Încărcat de

Drepturi de autor:

Formate disponibile

Shaheed Zulfikar Ali Bhutto Institute of

Sciences & Technology

Introduction to Business Finance

Financial Statement Analysis

1. Current Ratio Total Current 13287592000 19202591000 0.8391 x 1.59295 x

3. Leverage Total Liabilities 21531599000 21912677000 1.01605 x 0.72847 x

4. Gross Margin Gross Profit / 5679730000 / 1915273000 / 0.31487 x 0.15388 x

Financial Statement Analysis

Sr. Ratios Formulas Computation Computation Results of Results of

1. Current Ratio Total Current 1645675393 / 1332629006 / 0.5585 x 0.6608 x

4. Leverage Total Liabilities 6353347077 / 5294791353 / 2.7969 x 2.2732 x

5. Gross Margin Gross Profit / 804559290 / 87401851 / 0.2369 x 0.0637 x

Comparison of Ratios for the Year 2008 & 2009

Financial Statement Analysis

Current ratio = Total Current Assets ÷ Total Current Liabilities

Interpretation Current Ratio:

Quick Ratio = (Cash + Govt. Securities + Receivables) ÷ Total Current Liabilities

Interpretation Quick Ratio:

Net Worth = Total Assets – Total Liabilities

Interpretation Net Worth :

Leverage Ratio = Total Liabilities ÷ Net Worth

Interpretation Leverage Ratio:

5. Gross Margin Ratio

Gross Margin Ratio = Gross Profit / Net sales

Interpretation Gross Margin Ratio:

6. Net Profit Margin Ratio

Net Profit Margin Ratio = Net Profit / Net Sales

Interpretation of Net Profit Margin Ratio:

7. Inventory Turnover Ratio

Inventory Turnover Ratio = Cost of Goods Sold / Inventory

8. Accounts Receivable Turnover Ratio

Accounts Receivable Turnover Ratio = Net Credit Sales / 365 (days)

9. ROI (Return on Investment)

ROI = Net Profit / Net Worth

10. ROA (Return on Assets)

ROA = Net Profit / Total Assets

Kohat Cement Company Limited

Financial Statement Analysis

COMPARISON OF RATIOS FOR THE YEAR 2008 & 2009

Current ratio = Total Current Assets ÷ Total Current Liabilities

Interpretation Current Ratio:

Quick Ratio = (Cash + Govt. Securities + Receivables) ÷ Total Current Liabilities

Interpretation Quick Ratio:

Net Worth = Total Assets – Total Liabilities

Interpretation Net Worth :

Leverage Ratio = Total Liabilities ÷ Net Worth

Interpretation Leverage Ratio:

5. Gross Margin Ratio

Gross Margin Ratio = Gross Profit / Net sales

5. Gross Margin Ratio

Interpretation Gross Margin Ratio:

6. Net Profit Margin Ratio

Net Profit Margin Ratio = Net Profit / Net Sales

6. Net Profit Margin Ratio

7. Inventory Turnover Ratio

Inventory Turnover Ratio = Cost of Goods Sold / Inventory

7. Inventory Turnover Ratio

Interpretation of Inventory Turnover Ratio:

8. Accounts Receivable Turnover Ratio

Accounts Receivable Turnover Ratio = Net Credit Sales / 365 (days)

Interpretation of Accounts Receivable Turnover Ratio:

9. ROI (Return on Investment)