Microsoft Office Tutorials and References
In Depth Information
Important Tools for Any Business
Days Inventory
Days Inventor y shows a ratio indicating how many days a business could continue selling
using only its existing inventor y as of the report date.
Net Sales to Inventory
Net Sales to Inventor y shows the size of annual net sales relative to inventor y for the period,
on an annualized basis.
Days Purchases in AP
Days Purchases in AP indicates the size of the accounts payable relative to cost of sales for
the period.
Net Sales to Working Capital
Net Sales to Working Capital indicates the size of annual net sales relative to working capital
for the period on an annualized basis.
Total Assets to Net Sales
Total Assets to Net Sales shows how many dollars of assets are required to produce a dollar
of sales for the period on an annualized basis.
Net Sales to AR
Net Sales to AR indicates the size of annual net sales relative to accounts receivable for the
period on an annualized basis.
Net Sales to Net Fixed Assets
(Net Sales*Days in Year)/(Fixed Assets*Days in Period)
Net Sales to Net Fixed Assets shows the size of the annual net sales relative to the net fixed
assets for the period on an annualized basis.
Net Sales to Total Assets
Net Sales to Total Assets shows the size of the annual net sales relative to total assets for the
period on an annualized basis.
Net Sales to Net Worth
Net Sales to New Worth shows the size of the net sales relative to net worth (Total Assets
minus Total Liabilities) for the period on an annualized basis.
Amortization and Depreciation Expense to Net Sales
Amortization and Depreciation Expense to Net Sales indicates what percentage of each dollar
of sales pays noncash expenses, such as amortization expense of intangible assets such as
copyrights and patents and depreciation expense of fixed assets for the period.
Gross Profit Percentage
Gross Profit Percentage indicates what percentage of each dollar of sales is left over after
paying the cost of sales amount for the period.
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