**Finance Formulas** / July 17, 2018 / Alia Marquez

read moreDebt ratio is a solvency ratio that measures a firm’s total liabilities as a percentage of its total assets. In a sense, the debt ratio shows a company’s ability to...

**Finance Formulas** / July 16, 2018 / Kenley Hopper

read moreAnnual percentage rate (APR) is the annualized interest rate on a loan or investment which doesn’t account for the effect of compounding. It is the annualized form of the periodic...

**Finance Formulas** / July 15, 2018 / Aniyah Booth

read moreBecause of the cost principle (and other accounting principles), assets are generally reported on the balance sheet at cost (or lower) amounts. As a result, it would be incorrect to...

**Finance Formulas** / August 5, 2018 / Alia Marquez

read moreCurrent assets is a balance sheet account that represents the value of all assets that can reasonably expect to be converted into cash within one year. Current assets include cash...

**Finance Formulas** / August 4, 2018 / Alia Marquez

read moreConsider the following example to illustrate the concept. Assume hypothetical company BigBox has operating income or earnings before interest and taxes (EBIT) of $100 million in Year 1, with interest...

**Finance Formulas** / August 4, 2018 / Alia Marquez

read moreAverage total assets is defined as the average amount of assets recorded on a company's balance sheet at the end of the current year and preceding year. This figure is...

*Finance Formulas* / August 5, 2018 / Briana Leonard

read moreA lower debt ratio usually implies a more stable business with the potential of longevity because a company with lower ratio also has lower overall debt. Each industry has its...

__Finance Formulas__ / August 5, 2018 / Kenley Hopper

read moreBond valuation is a technique for determining the theoretical fair value of a particular bond. Bond valuation includes calculating the present value of the bond's future interest payments, also known...

*Finance Formulas* / August 5, 2018 / Alia Marquez

read moreYou can use the bond price formula to determine the value of a bond. While it involves some number crunching, it’s a fairly straightforward process because future cash flows to...

__Finance Formulas__ / August 5, 2018 / Avalynn Orr

read moreConversely, firms in sectors, such as utilities and telecommunications, which have large asset bases will have lower asset turnover. Since this ratio can vary widely from one industry to the...

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