Financial Ratios Formula

Days Sales Outstanding Formula | DSO Formula

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Days Sales Outstanding Formula

Days Sales Outstanding Formula DSO Formula can be calculated by dividing the account receivable by the net credit sales and multiply it by the number of days in the period. Often this formula is used at the end of the year due to which number of days 365 and in the equation form it can be written as

Days Sales Outstanding = (Account Receivable/Net credit sales) x 365

Days Sales Outstanding Formula

On the year-end balance sheet Account receivable can be found and Net credit sales reported separate from the gross sales on the income statement. Net credit sales mostly provided by the company. You can learn about the definition of Days Sales Outstanding ratio.

Financial Ratio is a forum where you will learn about all ratios definitions and formulas.

Debt Service Coverage Ratio Formula (DSCR)

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Debt Service Coverage Ratio Formula (DSCR)

Debt Service Coverage Ratio Formula (DSCR) is calculated by dividing the net operating income by the total debt service cost.

Debt Service Coverage Ratio = Operating Income/Total debt service cost

Debt Service Coverage Ratio Formula (DSCR)

Operating Income is the income which leftover after the payment of all the operating expenses. Operating income is also called EBIT. On the income statement, it is separately stated. Debt Service Coverage Ratio Formula will help you in your calculations.

All the cost related to servicing the debt of the company is called total debt services. Interest payment, principal payments, and other obligations are often included in the total debt services. In the financial statement, it is given. You can check the definition of Debt Service Coverage Ratio DSCR.

Financial Ratio is a forum where you will learn about all ratios definitions and formulas.

Account Receivable Turnover Ratio Formula

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Account Receivable Turnover Ratio Formula is used to measure the efficiency of the company to collect the credit from its customers. Some companies collect the account receivable in a short time such as in 90 days. While some companies collect credit from customers within 6 months. Account Receivable Turnover Ratio Formula also uses to measure the liquidity of the company. if the company convert receivable quickly then the company will be more liquid.

Account Receivable Turnover Ratio Formula calculated by dividing the net credit sales by average account receivable for that period.

Account Receivable Turnover Ratio Formula = Net Credit Sales/Average Account Recievable

 

Accumulated Depreciation to Fixed Assets Ratio Formula

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Investors use mostly Accumulated Depreciation to Fixed Assets Ratio Formula to find the productiveness of the invested capital of the company infixed assets. If the result of this ratio is low it means that the fixed assets of the company have plenty of life left and maybe use for years to come. If the result given by the formula is high then the fixed assets of the company need to replace immediately.

Accumulated Depreciation to Fixed Assets Ratio Formula can be calculated by dividing the total accumulated depreciation by the total fixed assets.

Accumulated Depreciation to Fixed Assets Ratio Formula= Accumulated depreciation/Total Fixed Assets

Asset Coverage Ratio Formula

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Asset Coverage Ratio Formula used by the investors and analysts to find the capital management, financial stability, and overall riskiness of the company. If the result of the formula is high then the company’s assets drastically outnumber liabilities which is good for the investors.

Asset Coverage Ratio Formula can be calculated by subtracting the current liabilities less the short term portion of long term debt from the total assets less the intangibles and dividing the difference of it by the total debt.

((Total Assets – Intangible Assets)-( Current Liabilities – Short term portion of LT debt))/Total debt