body {
font-family: 'Segoe UI', Tahoma, Geneva, Verdana, sans-serif;
background-color: #f8f9fa;
color: #333;
line-height: 1.6;
margin: 0;
padding: 0;
}
.loan-calc-container {
max-width: 800px;
margin: 40px auto;
background-color: #ffffff;
padding: 30px;
border-radius: 8px;
box-shadow: 0 4px 15px rgba(0, 74, 153, 0.1);
}
h1, h2 {
color: #004a99;
text-align: center;
margin-bottom: 20px;
}
.input-group {
margin-bottom: 20px;
display: flex;
align-items: center;
flex-wrap: wrap;
}
.input-group label {
flex: 1 1 150px; /* Flexible basis for labels */
min-width: 120px; /* Minimum width for labels */
margin-right: 15px;
font-weight: bold;
color: #004a99;
}
.input-group input[type="number"],
.input-group input[type="text"] {
flex: 2 1 200px; /* Flexible basis for inputs, taking more space */
padding: 10px 15px;
border: 1px solid #ced4da;
border-radius: 4px;
box-sizing: border-box; /* Include padding and border in the element's total width and height */
font-size: 1rem;
}
button {
display: block;
width: 100%;
padding: 12px 20px;
background-color: #004a99;
color: white;
border: none;
border-radius: 4px;
font-size: 1.1rem;
cursor: pointer;
transition: background-color 0.3s ease;
margin-top: 20px;
}
button:hover {
background-color: #003366;
}
#result {
margin-top: 30px;
padding: 20px;
background-color: #e7f3ff; /* Light blue background for emphasis */
border-left: 5px solid #004a99;
border-radius: 4px;
text-align: center;
font-size: 1.4rem;
font-weight: bold;
color: #004a99;
}
#result span {
color: #28a745; /* Success green for the actual calculated value */
}
.article-section {
margin-top: 40px;
background-color: #ffffff;
padding: 30px;
border-radius: 8px;
box-shadow: 0 2px 10px rgba(0, 74, 153, 0.05);
}
.article-section h2 {
text-align: left;
margin-bottom: 15px;
}
.article-section p, .article-section ul {
margin-bottom: 15px;
}
.article-section ul {
padding-left: 20px;
}
.article-section li {
margin-bottom: 8px;
}
/* Responsive adjustments */
@media (max-width: 600px) {
.input-group {
flex-direction: column;
align-items: stretch;
}
.input-group label {
margin-right: 0;
margin-bottom: 10px;
flex-basis: auto; /* Reset flex basis for labels */
min-width: auto;
}
.input-group input[type="number"],
.input-group input[type="text"] {
flex-basis: auto; /* Reset flex basis for inputs */
width: 100%;
}
.loan-calc-container {
padding: 20px;
}
h1 {
font-size: 1.8rem;
}
#result {
font-size: 1.2rem;
}
}
Understanding Financial Ratios
Financial ratios are essential tools for analyzing a company's performance and financial health. They are calculated by dividing one financial metric by another, providing insights into profitability, liquidity, solvency, and efficiency. By comparing these ratios over time or against industry benchmarks, stakeholders can make informed decisions.
Key Financial Ratios Calculated:
1. Gross Profit Margin
The Gross Profit Margin measures a company's profitability after accounting for the cost of goods sold (COGS). It indicates how efficiently a company is managing its production and direct costs.
Formula: Gross Profit Margin = (Gross Profit / Total Revenue) * 100%
A higher percentage generally suggests better profitability and cost management.
2. Operating Profit Margin
The Operating Profit Margin (or EBIT margin) assesses a company's profitability from its core business operations before interest and taxes. It reflects operational efficiency and management effectiveness.
Formula: Operating Profit Margin = (Operating Income / Total Revenue) * 100%
Where Operating Income = Gross Profit – Operating Expenses.
3. Net Profit Margin
The Net Profit Margin is a key indicator of profitability, showing how much net income (or profit) is generated as a percentage of total revenue. It represents the bottom line.
Formula: Net Profit Margin = (Net Income / Total Revenue) * 100%
A higher net profit margin signifies greater efficiency in controlling costs and maximizing profits.
4. Current Ratio
The Current Ratio is a liquidity ratio that measures a company's ability to pay its short-term obligations (those due within one year) using its current assets.
Formula: Current Ratio = Current Assets / Current Liabilities
A ratio above 1 is generally considered favorable, indicating that the company has more current assets than current liabilities.
5. Debt-to-Asset Ratio
The Debt-to-Asset Ratio indicates the proportion of a company's assets that are financed through debt. It is a measure of financial leverage and solvency.
Formula: Debt-to-Asset Ratio = Total Liabilities / Total Assets
A lower ratio suggests less financial risk and a more conservative capital structure.
How to Use the Calculator:
Input the values for Total Revenue, Cost of Goods Sold, Gross Profit, Operating Expenses, Net Income, Current Assets, Current Liabilities, Total Assets, and Total Liabilities. Click "Calculate Ratios" to see the results.
Example:
If a company has:
- Total Revenue: 1,500,000
- Cost of Goods Sold: 900,000
- Gross Profit: 600,000
- Operating Expenses: 250,000
- Net Income: 200,000
- Current Assets: 300,000
- Current Liabilities: 120,000
- Total Assets: 750,000
- Total Liabilities: 375,000
The calculator would output:
- Gross Profit Margin: 40.00%
- Operating Profit Margin: 16.67%
- Net Profit Margin: 13.33%
- Current Ratio: 2.50
- Debt-to-Asset Ratio: 0.50 or 50.00%
function calculateFinancialRatios() {
var revenue = parseFloat(document.getElementById("revenue").value);
var costOfGoodsSold = parseFloat(document.getElementById("costOfGoodsSold").value);
var grossProfitInput = parseFloat(document.getElementById("grossProfit").value);
var operatingExpenses = parseFloat(document.getElementById("operatingExpenses").value);
var netIncome = parseFloat(document.getElementById("netIncome").value);
var currentAssets = parseFloat(document.getElementById("currentAssets").value);
var currentLiabilities = parseFloat(document.getElementById("currentLiabilities").value);
var totalAssets = parseFloat(document.getElementById("totalAssets").value);
var totalLiabilities = parseFloat(document.getElementById("totalLiabilities").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
// — Input Validation —
if (isNaN(revenue) || revenue <= 0) {
resultDiv.innerHTML = "Please enter a valid Total Revenue greater than zero.";
return;
}
if (isNaN(costOfGoodsSold) || costOfGoodsSold < 0) {
resultDiv.innerHTML = "Please enter a valid Cost of Goods Sold (cannot be negative).";
return;
}
if (isNaN(grossProfitInput) || grossProfitInput < 0) {
resultDiv.innerHTML = "Please enter a valid Gross Profit (cannot be negative).";
return;
}
if (isNaN(operatingExpenses) || operatingExpenses < 0) {
resultDiv.innerHTML = "Please enter valid Operating Expenses (cannot be negative).";
return;
}
if (isNaN(netIncome) || netIncome < 0) {
resultDiv.innerHTML = "Please enter a valid Net Income (cannot be negative).";
return;
}
if (isNaN(currentAssets) || currentAssets <= 0) {
resultDiv.innerHTML = "Please enter valid Current Assets greater than zero.";
return;
}
if (isNaN(currentLiabilities) || currentLiabilities <= 0) {
resultDiv.innerHTML = "Please enter valid Current Liabilities greater than zero.";
return;
}
if (isNaN(totalAssets) || totalAssets <= 0) {
resultDiv.innerHTML = "Please enter valid Total Assets greater than zero.";
return;
}
if (isNaN(totalLiabilities) || totalLiabilities 0) {
grossProfitMargin = (grossProfitInput / revenue) * 100;
}
var operatingIncome = grossProfitInput – operatingExpenses;
var operatingProfitMargin = 0;
if (revenue > 0) {
operatingProfitMargin = (operatingIncome / revenue) * 100;
}
var netProfitMargin = 0;
if (revenue > 0) {
netProfitMargin = (netIncome / revenue) * 100;
}
var currentRatio = 0;
if (currentLiabilities > 0) {
currentRatio = currentAssets / currentLiabilities;
}
var debtToAssetRatio = 0;
if (totalAssets > 0) {
debtToAssetRatio = (totalLiabilities / totalAssets) * 100;
}
// — Display Results —
resultDiv.innerHTML =
"