Ratio | What does it do? | How to calculate |
Current | Measures the financial health of your business. A health business results in 2+ | Divide your Total Assets by your Total Liabilities |
Quick | Measures your business liquidity. The optimal result is 1+ | Divide your Current Assets (less stock) by your Current Liabilities |
Stock Turnover | Many Practices are now selling products and often cash can be tied up in unsold stock | Cost of goods sold divided by the average value of stock |
Average Fees Earned by Practitioners | Individual Practitioners can compare their fees earned with average fees earned by | Total Fees earned in a given period divided by the number of Fee Earning Practitioners |
Average Fees Earned by all Personnel | Staff members can see a result from their efforts and share in the rewards | Total Fees earned in a given period divided by the number of Personnel |
Average Hourly Income | Calculates the average hourly income | Total fess earned in a given period divided by the total working hours of fee earning practitioners |
Average Hourly Expense | Calculates the average hourly expense | Total expenses in a given period divided by the total working hours |
Average Daily Expense | Calculates the average daily expense for running your business | Total Expenses in a given period divided by the total working days |
Break Even | Take the average hourly income and see how many hours you need to work to cover the expenses for the day. Once the expenses are covered, the income to end of day is then profit | Calculate this for the week instead of the day and you might be more relaxed about having a day off |