Performance Measurement

Add more ratios to your toolkit that will allow you to measure performance and drive results.

Course Progress

Course Description

The tenth lesson of our "Accounting 101" series, “Performance Measurement” equips you with the skills to effectively use financial statement ratios. By understanding how to evaluate a company's financial performance and health through these quantitative measures, you will gain valuable insights into profitability, liquidity, efficiency, and solvency. This knowledge empowers stakeholders to make informed decisions regarding investments, lending, and assessing a company's overall financial well-being, laying a strong foundation for your future endeavors in accounting and finance.

By the end of this course, you will able to answer questions such as:

• How can turnover ratios be used to assess the efficiency of a company’s operations?
• What steps can a company take to speed up its cash conversion cycle?
• What are the implications of the DuPont model of return on equity?

Turnover Ratios Overview

Asset Turnover Ratio

Asset Turnover Variance by Industry

Why Some Valuable Assets Can't Be Capitalized

Inventory Turnover Ratio

Accounts Receivable Turnover Ratio

Accounts Payable Turnover Ratio

Measuring Turnover Ratios in Days

Cash Conversion Cycle

Return on Assets

Return on Equity

DuPont Model of Return on Equity

Course Review

Course Quiz

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