RATIOS ANALYSISOF BATA SHOE COMPANY
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RATIOS ANALYSISOF BATA SHOE COMPANY
Quick Ratio Quick ratio of Bata Shoe Company shows the taka
available for covering each of taka current asset. To find the quick ratio the formula is:
Quick Ratio = (Cash + Account Receivable)/Total current liabilities.
SOLVENCY RATIOS
YEAR Quick Ratio
2008 0.2477
2009 0.3080
2010 0.1919
2011 0.2690
2012 0.2439
Quick Ratio Contd……….
Current Ratio of Bata Shoe Company measures the margin of safety present to cover any possible reduction of current asset. To find the Current Ratio the formula is:
Current Ratio = Total current asset / Total current liabilities.
Current Ratio
Current Ratio Contd……YEAR Current Ratio
2008 1.4542
2009 1.4721
2010 1.4526
2011 1.4687
2012 1.5347
: Current Liabilities To Net Worth ratio of Bata Shoe Company contrasts the amount due creditors within a year with funds permaneently invested by the owners. The smaller the net worth and the larger the libilities, the greater the risk. To find the Current Liabilities To Net Worth Ratio the formula is
Current Liabilities To Net Worth= Total current liabilities/ Net Worth.
Current Liabilities To Net Worth Ratio
YEAR Current Liabilities To Net Worth Ratio
2008 1.4240
2009 1.3123
2010 1.1997
2011 1.1744
2012 1.1037
Current Liabilities To Net Worth Ratio Contd….
Current Liabilities to Inventory Ratio of Bata Shoe Company tells how much a firm relies on funds from disposal of unsold inventories to meet debt. To find the Current Liabilities to Inventory Ratio the formula is:
Current Liabilities to Inventory Ratio = Total current liabilities/ Inventory.
Current Liabilities to Inventory Ratio
YEAR Current Liabilities to Inventory
Ratio 2008 0.9480
2009 1.0259
2010 0.9325
2011 1.0438
2012 1.0195
Current Liabilities to Inventory Ratio contd…….
Total Liabilities to Net Worth Ratio of Bata Shoe Company compares the company’s indebtedness to the venture capital invested by the owner. To find the Total Liabilities to Net Worth Ratio the formula is:
Total Liabilities to Net Worth Ratio = Total Liabilities/ Net Worth
Total Liabilities to Net Worth Ratio
YEAR Total Liabilities to Net Worth Ratio
2008 1.5548
2009 1.4301
2010 1.31157
2011 1.2719
2012 1.1249
Total Liabilities to Net Worth Ratio Contd…..
Fixed Assets to Net Worth Ratio of Bata Shoe Company reflects the portion of net worth that consists of fixed assets. Generally a smaller ratio is desired. To find the Fixed Assets to Net Worth Ratio the formula is:
Fixed Assets to Net Worth Ratio= Fixed
Assets/ Net Worth.
Fixed Assets to Net Worth Ratio
YEAR Fixed Assets to Net Worth Ratio
2008 0.4837
2009 0.4981
2010 0.5686
2011 0.5470
2012 0.5317
Fixed Assets to Net Worth Ratio contd……..
Inventory Turnover Ratio determines the rate at which merchandise is being moved and the effect on the flow of funds into a business. To find the Inventory Turnover Ratio the formula is:
Inventory Turnover Ratio=Sales/Inventories.
Inventory Turnover Ratio
YEAR Inventory Turnover Ratio
2008 3.16
2009 3.48
2010 3.32
2011 3.78
2012 3.75
Inventory Turnover Ratio Contd……..
Sales to Net Working Capital Measures how well the company's short-term
assets are being used to generate sales.
2008 2009 2010 2011 20126.20
6.40
6.60
6.80
7.00
7.20
7.40
7.60
7.80
8.00
7.35
7.19
7.88
7.74
6.88
Sales to Net Working Capital
Assets to Sales Ratio
Compare how much in assets a company has relative to the amount of revenues the company can generate using their assets.
2008 2009 2010 2011 20120.52
0.53
0.54
0.55
0.56
0.54
0.55
0.54
0.53
0.56
Assets to Sales
Accounts payable to Sales Ratio
Measures the speed with which a company pays vendors relative to sales.
A high ratio can indicate that a firm is delaying payment to suppliers.
2008 2009 2010 2011 20120.115
0.125
0.135
0.145
0.155 0.154
0.147
0.1390.141
0.130
Accounts Payable to Sales
Accounts Payable to Sales 2008 2009 2010 2011 201242
44
46
48
50
52
54
56
58
5654
51 52
48
Days to Pay Suppliers
Profitability Ratios
Return on Sales (Profit Margin)
Measures net income per dollar of sales and is calculated as net profits after taxes divided by sales.
2008 2009 2010 2011 20128.20%
8.40%
8.60%
8.80%
9.00%
9.20%
9.40%
9.60%
9.80%
9.72%
9.00%
9.61%
8.73% 8.84%
Return on Sales
Return on Asset (ROA)
ROA gives an idea as to how efficient management is at using its assets to generate earnings.
20082009
20102011
2012
14.50%
15.00%
15.50%
16.00%
16.50%
17.00%
17.50%
18.00%
18.50%18.10%
16.50%
17.79%
16.37%
15.88%
Return on Assets
Return on Assets
Return on Equity (ROE)
ROE measures a company's profitability by revealing how much profit a company generates with the money shareholders have invested.
2008 2009 2010 2011 2012
Return on Equity 46.23% 40.11% 41.13% 37.19% 33.74%
2.50%
7.50%
12.50%
17.50%
22.50%
27.50%
32.50%
37.50%
42.50%
47.50%
46.23%40.11% 41.13% 37.19% 33.74%
Return on Equity
Efficiency Ratio
Collection Period: used to evaluate the firm’s ability to collect its credit sales in a timely manner.
Collection Period =Accounts Receivables * 365 Days / sales
2008 2009 2010 2011 20120
2
4
6
8
10
12
14
6 7 910
12
Collection Period
Collection Period