30 lines
1.1 KiB
Org Mode
30 lines
1.1 KiB
Org Mode
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#+title: Section 6 | Lesson 36 - Financial Rations, Leverage
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* Links
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- [[./../mba-main.org][<Back to Main MBA]]
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- [[https://www.udemy.com/course/an-entire-mba-in-1-courseaward-winning-business-school-prof/learn/lecture/4282978#overview][S06:L36 Financial Ratios]]
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* Notes
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** Liquidity Ratios
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*** basics
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- also called "Liquidity"
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- measure our ability to pay short term debt
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- get a loan
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*** Current Ratio
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- \( \text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}} \).
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- if it is positive, then the banks think you can pay your bills
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*** quick ratio
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- \( \text{Quick Ratio} = \frac{\text{Current Ratio} - \text{inventory}}{\text{Current Liabilities}}\)
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- used in case the inventory has to be discounted (ie the inventory just got recalled)
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** Leverage Ratios
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- Debt to total assets = debt / assets
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- Interest coverage = EBITDA / interest
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- Earnings Before Interest Taxes Depreciation and Amoritization
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