Something from unit eight - Total margin ratio: Profitability ratio that compares the excess of revenues over expenses with total revenues to determine the overall profits earned, including all sources of revenues and expenses, per dollar of revenues. Ratio analysis: Comparison of one number with another in order to gain insight from the relationship between the numbers. (Finkler 554) Quick ratio: Cash, marketable securities, plus receivables divided by current liabilities. This liquidity ratio is a more stringent test of the ability to meet current obligations as they come due than the widely used current ratio. Sometimes called the acid test. Ratio analysis: Comparison of one number with another in order to gain insight from the relationship between the numbers. Receivables turnover: Revenues and support divided by accounts receivable; see also average collection period. Return on assets (ROA): Increase in net assets divided by total assets; profitability ratio that measures the rate of return the organization earns on its total assets. Return on equity: Profitability ratio that assesses the amount of profit earned on each dollar of equity. Return on net assets (RONA): Increase in net assets divided by net assets; profitability ratio that measures the relative increase in net assets. Review of financial statements: Auditor review for form and accuracy; in a review, the auditor does not perform the extensive testing of records and detailed review that are part of an audit. (Finkler 554) Financial statement analysis: Analysis of the profitability and viability of an organization achieved by reviewing financial statements, including their accompanying notes and the auditor’s report, performing ratio analysis, and using comparative data. (Finkler 553)
Posted on: Fri, 20 Sep 2013 16:59:29 +0000
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