Activity ratios

Activity ratios reflect an enterprise's ability to convert various items into cash or revenue.

• Days sales outstandings (DSO) - The average number of days it takes customers to repay the enterprise for purchased products or services.

• Days sales of inventory (DSI) - The number of days of an enterprise's inventory turnover.

• Days of payable outstanding (DPO)- The average number of days it takes an enterprise to repay its accounts payable.

• Cash coversion cycle (CCC) - The time period from payment of debts to collection of cash.

• Receivables turnover - Reflects the enterprise's ability to recover capital on its receivables.

• Inventory turnover - The number of times an enterprise sells and replaces its inventory during a given period.

• Accounts payable turnover - Reflects the speed at which an enterprise pays its suppliers.

• Working capital turnover - Reflects how well an enterprise uses working capital to support a certain level of sales.

• Total asset turnover - Reflects the efficiency of using assets of the enterprise.

• Fixed asset turnover - Measures an enterprise's ability to generate net revenue from its fixed asset investments.

• Paid dividends/Charter capital - Measures the amount of dividends paid compared to the charter capital of the enterprise.

• EBIT/Fixed assets - Measures earnings before taxes and interest relative to a business's fixed assets.

Activity ratios