Accounting Ratio

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Dictionary Says

Definition of 'Accounting Ratio'

A way of expressing the relationship between one accounting result and another, which is intended to provide a useful comparison. Accounting ratios assist in measuring the efficiency and profitability of a company based on its financial reports. Accounting ratios form the basis of fundamental analysis.

Also called financial ratio.

Investopedia Says

Investopedia explains 'Accounting Ratio'

An accounting ratio compares two aspects of a financial statement, such as the relationship (or ratio) of current assets to current liabilities. The ratios can be used to evaluate the financial condition of a company, including the company's strengths and weaknesses. An example of an accounting ratio is the price-to-earnings (P/E) ratio of a stock. This measures the price paid per share in relation to the profit earned by the company per share in a given year.
Search results for

'Accounting Ratio'

  • Receivables Turnover Ratio

    http://www.investopedia.com/video/play/receivables-turnover-ratio
    ... Accrual accounting is an important method of measuring the performance and
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  • Interest Coverage Ratio

    http://www.investopedia.com/video/play/interest-coverage-ratio
    ... Accrual accounting is an important method of measuring the performance and
    position of ... Read More »; Receivables Turnover Ratio. ...

  • Using The Current Ratio

    http://www.investopedia.com/video/play/current-ratio
    ... Find out more on how this liquidity ratio is used to measure a company's ability
    to pay short-term obligations. Filed Under » Accounting, Fundamental Analysis. ...

  • Using The Price-To-Book Ratio To Evaluate Companies

    http://www.investopedia.com/articles/fundamental/03/112603.asp
    ... First of all, the ratio is really only useful when you are ... Thanks to conservative
    accounting rules, book value completely ignores intangible assets like brand ...

  • How To Decipher Accrual Accounting

    http://www.investopedia.com/video/play/accrual-accounting
    ... Accrual accounting is an important method of measuring the performance and
    position of ... Read More »; Receivables Turnover Ratio. ...

  • CFA Level 1 Study Guide - Equity Investments - The Concentration ...

    http://www.investopedia.com/exam-guide/cfa-level-1/equity-investments/concentration-ratio-herfindahl-index.asp
    ... 9.22 Accounting For Leases. 10. ... 13.9 Life Cycle Analysis: The Industry Life Cycle;
    13.10 The Concentration Ratio and the Herfindahl Index; ...

  • Dynamic Current Ratio: What It Is And How To Use It

    http://www.investopedia.com/articles/02/090302.asp
    ... in the accounting literature to maintain a high degree of prudence in both the
    preparation and analysis of financial statements, the cash ratio may not be such ...

  • Cash Flow Indicator Ratios: Dividend Payout Ratio | Investopedia

    http://www.investopedia.com/university/ratios/cash-flow-indicator/ratio4.asp
    ... In view of this accounting treatment of dividends, it is incumbent upon investors
    to check a company's dividend payout ratio against an adequate margin of free ...

  • Analyzing The Price-To-Cash-Flow Ratio

    http://www.investopedia.com/articles/stocks/11/analyzing-price-to-cash-flow-ratio.asp
    ... to standardize due to the variable accounting practices across companies. Studies
    regarding fundamental analysis have concluded that the P/CF ratio provides a ...

  • CFA Level 1 Study Guide - Assets - Effects of Inventory Accounting ...

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/inventory-accounting.asp
    ... 9.22 Accounting For Leases. 10. ... 13.9 Life Cycle Analysis: The Industry Life Cycle;
    13.10 The Concentration Ratio and the Herfindahl Index; ...

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