How FV of Annuity Payment Helps to Calculate the Viability of an Investment

Future value of annuity payment = [FV (R)] ÷ [(1 + R)n – 1] FV = future value R = rate for period N = # of periods Future value of annuity formula helps to determine the cash flows from investments when the future value is available. As you may…

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How Annuity Due Payment (present value) Helps to Predict the Return on Investments

Annuity due payment with PV = PV × [r ÷ {1 – (1 + r)-n } ] PV = present value r = rate for period n = # of periods Annuity due payment with present value formula helps to calculate each installment for a series of payments or cash…

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Do Asset to Sales Ratio Indicates Business Potential to Generate Revenue

Asset to sales ratio = Total assets ÷ Sales revenue An asset to sales ratio tells about the capability of a company for using its assets to generate revenue. To calculate asset to sales ratio one can simply divide total assets by total sales revenue of the company. But here…

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Did Average Collection Period Ratio Gives View in Cash Management Cycle

Avg. Collection period = 365 ÷ Receivables Turnover Average collection period formula keeps an eye on the number of days a company takes to turn in its receivables into cash. To calculate avg. collection period one can simply divide the number of days in a term by receivable turnover ratio….

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