current ratio, current assets / current liabilities , acid test ratio, liquid assets / current liabilities , profitability , measure of the ability to make a profit from sales, gross profit margin, (gross profit / revenue) x 100, operating profit margin, (operating profit / revenue) x 100, capital employed , the total value of all long-term finance invested in a business, rate of inventory turnover, number of times in a year that inventory is bought in and sold, trade receivables turnover, (trade receivables / credit sales) x 365, trade payables turnover , (trade payables / credit purchases) x 365, credit purchases , value of materials and other supplies bought by a business on credit, gearing ratio, ratio that measures the proportion of capital employed in the business that is financed by long-term borrowing, dividend, the share of the company profits paid to shareholders, dividend cover ratio, ratio that measures how many times dividends could be paid from profit for the year, price/earnings ratio, number of years it would take at the current earnings per share to purchase on share at the current market.
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Chapter 34
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