Policy & Guidance: Worksheet K

Interim Economic Guidance for Water Quality Standards

Calculation of Beaver's Ratio

BR = CF ÷ TD

Where:	BR	=	Beaver's Ratio
	CF	=	Cash Flow
	TD	=	Total Debt

	Three Most Recently Completed Fiscal Years
	19___		19 ___		19 ___
Cash Flow:
Net Income After Taxes	$________		$________		$________		(1)
Depreciation	$________		$________		$________		(2)
CF [Calculate: (1) + (2)]	$________		$________		$________		(3)
Total Debt:
Current Debt	$________		$________		$________		(4)
Long-Term Debt	$________		$________		$________		(5)
Total Debt	$________		$________		$________		(6)
Beaver's Ratio:
BR [(3) /(6)]							(7)

Considerations:

Is the most recent year typical of the three years? __ Yes __ No

(If not, you might want to use an earlier year or years for the analysis)

Is the Beaver's Ratio for this discharger greater than 0.2? __ Yes __ No

Is the Beaver's Ratio for this discharger less than 0.15? __ Yes __ No

Is the Beaver's Ratio for this discharger between 0.2 and 0.15? __ Yes __ No

How does this ratio compare with the Beaver's Ratio for other firms in the same business?