Owner analysis purpose: decide whether to invest or not, examine performance, decide to encourage allocation Analysis content: profitability, competitiveness and financing situation, bankruptcy risk, capital preservation and appreciation

Creditor analysis purpose: decide whether to grant a loan and understand debt repayment ability Analysis content: Loan returns and risks, profitability, capital flow status

Purpose of supplier analysis: whether to cooperate, deferred payment Analysis content: Purchaser’s sales credit status

Relevant government departments Analysis purpose: Understand corporate tax status, employee income and employment status Analysis content: efficiency of use of funds and degree of social contribution

Business managers Analysis purpose: Coordinate the relationship between the company and different stakeholders Analysis content: all issues that users of financial statements are concerned about

equals operating profit divided by operating income

It is an indicator to measure the operating efficiency of an enterprise.

If you want to increase, you need to increase operating profits or reduce costs and expenses.

Equal to net profit divided by operating income

The higher the indicator, the better. The higher the value, the stronger the profitability of the company.

Total profit divided by total costs

The higher the indicator, the stronger the profitability of the company.

Equals EBIT divided by interest expense

The greater the indicator, the stronger the company's ability to pay interest expenses. Generally 3~5 times is more appropriate

current ratio

speed ratio

cash ratio

It is generally believed that the current ratio is two, the quick ratio is one, and the cash ratio is above 20%.

Assets and liabilities

equity ratio

Equity Multiplier

Equity multiplier equals total assets divided by total owners' equity equals total assets divided by total assets minus liabilities equals one divided by one minus gearing ratio

Interest-bearing debt ratio

The workplace debt ratio is generally around 50%, the equity ratio is generally less than one, and the equity multiplier is greater than one.

Equals operating income divided by average accounts receivable

The higher the turnover rate indicates 1. Quick collection of accounts and shorter account aging 2. Strong asset liquidity and strong short-term solvency 3. It can reduce collection fees and bad debt losses, but the cancellation policy during the New Year will lead to the loss of some customers.

Equals operating cost divided by average inventory balance

The higher the inventory turnover rate, the more products can be produced and sold with less capital.

Inventory divided by average working capital

Generally speaking, working capital turnover ratio standards are between 75% and 100%

If it is greater than 100%, it means that the working capital is occupied by all inventories and it is not enough. If it is less than 100%, it means that the excess working capital can be used to repay debts.

Equal to operating income divided by the average net value of public assets

The higher the value, the better the utilization efficiency of fixed products.

Equals operating income divided by average balance of total assets

The higher the total asset turnover rate, the faster the turnover speed, the better the utilization effect, and the higher the level of operation and management.

Earnings before interest and taxes divided by average total assets

The higher the index, the stronger the profitability of the company, the better the asset utilization effect, and the higher the level of financial management.

Equals net income divided by average ownership equity

It is the core of corporate profitability indicators and the core of the entire financial indicator system.