# Ratios

**Topics:**Generally Accepted Accounting Principles, Financial ratios, Revenue

**Pages:**3 (336 words)

**Published:**March 9, 2015

Profitability Ratios Net Profit Margin = (Net Profit x 100) /Sales Revenue Return on Capital Employed = Net Profit (Operating Profit) x 100 (ROCE) Capital Employed

Solvency Ratios Gearing Ratio = Total Liabilities/Shareholders Equity

Investment Ratios Earnings per Share (EPS) = Net Income – Dividends on preferred stock Average Outstanding Shares Price/Earnings Ratio (P/E) = Market Price of Share/EPS

Aviation Industry Specific Ratios…

Available Seat Miles = Total No. of Seats Available for Transporting Passengers (ASM) x No. of Miles Flown during Period

Revenue Passenger Mile = No. of Revenue Paying Passengers x

(RPM) No. of Miles Flown During Period Load Factor

Quick/Acid Test Ratio = Current Assets less Stock/Current Liabilities Dividend Yield = Annual Dividends per Share

Price per Share

Liquidity Ratios

Current Ratio = Current Assets/ Current Liabilities

Quick Ratio = Current Assets – Inventories / Current Liabilities

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5.2 Efficiency Ratios

Asset Turnover = Revenue/ Assets

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5.3 Profitability Ratios

Net Profit Margin = Net Profit/ Net Revenue

ROCE = EBIT/ Total Assets – Current Liabilities

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5.4 Solvency Ratios

Gearing Ratio = Total Liability/ Shareholders Equity

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5.5 Investment Ratios

EPS = Net Income – Dividend on Preferred Stock/ Average Outstanding Shares

13

5.6Industry Specific Ratios

Revenue per Passenger Mile = No of Revenue Paying Passengers x No of Miles Flown Available Seat Miles = No of Miles Flown x...

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