P&L statement shows company's revenues, costs, and expenses over specific period. Essential financial document for businesses and investors. Public companies legally required to make P&L statements publicly available
ROE measures company profitability relative to shareholder equity. Formula: (Net Profit/Shareholder Equity) * 100. Can be used across industries and sectors
Measures number of times company collects average accounts receivable balance. Calculated as net credit sales divided by average accounts receivable. Net credit sales exclude cash sales and customer discounts/returns
Quick ratio measures company's short-term liquidity using most liquid assets. Also called acid test ratio, shows ability to pay current liabilities instantly. Higher ratio indicates better liquidity, lower ratio suggests debt payment difficulties
Debt ratio measures company's leverage by dividing total debt by total assets. Ratio above 1 indicates more liabilities than assets. Ratio below 1 shows more assets financed by equity
ROE measures company profitability by dividing net income by shareholders' equity. Shareholders' equity equals assets minus debt. Net income excludes dividends and interest payments