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## Accounting Ratios Class 12 All Formulas

Accounting Ratio is an arithmetical relationship between two accounting variables and It is a ratio which is calculated on the basis of accounting information.Accounting ratio is for the comparison of two or more financial data that are being used for analyzing the financial statements of the companies.

Accounting Ratios is an effective tool that is used by the shareholders, by the creditors and by all kinds of stakeholders or the interested parties to the organization. The comparison is done to understand the profitability, strength and the financial status of the companies.

### Accounting Ratios Class 12 All Formulas – Types of Ratio

**Liquidity Ratios**- Current Ratio
- Quick Ratio
- Cash Ratio

**Profitability Ratios:**- Gross Profit Margin
- Operating Margin
- Profit Margin
- Earnings Per Share

**Leverage Ratio**- Debt-to-Equity Ratio
- Debt-to-Asset Ratio
- Debt Ratio
- Interest Coverage Ratio

**Activity Ratio**- Receivable Ratio
- Inventory Turnover Ratio
- Asset Turnover Ratio

### Class 12th Accounting Ratio Formula

- Current Ratio = Current Assets/ Current Liabilities
- Quick Ratio = Quick assets/ Current Liabilities
- Operating Margin = Gross Profit – Operating Expense/ Revenue
- Profit margin = Revenue – Operating Expenses + Non-Operating Income – Interest Expense – Income Taxes/ Revenue
- Earnings per Share = Net Income – Preferred Dividend/ Weighted Average Outstanding Shares
- Debt Ratio = Total Liabilities/ Total Asset
- Receivable Ratio = Annual Sales Credit/ Accounts Receivable
- Asset Turnover Ratio = Net Revenue/ Assets

### Accounting Ratios Class 12 All Formulas PDF

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