Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Calculation of Leverage ratios -
2008
2009
2010
U
EBIT or Operating Profit (Net)
660135
935835
1182927
V
Interest Expenses
56543
86809
114257
W
Equity
1277659
1690493
2257267
X
Total Assets
3103645
4049092
5131809
Y
Long term Liabilities
833303
1018308
1130779
Z
Current Liabilities
992683
1340291
1743763
A1
Net Fixed Assets
1319370
1695821
2226664
Interest Coverage Ratio (U / V)
11.67
10.78
10.35
Owner's Equity to Total Liabilities ( W / (Y + Z))
0.70
0.72
0.79
Owner's Equity to Total Assets (W / X)
0.41
0.42
0.44
Fixed Assets to Long Term Liabilities (A1 / Y)
1.58
1.67
1.97
The leverage position of the firm as shown by the above ratios seems not too bad, in the sense that the equity position of the firm as compared to the total assets and liabilities are showing continuous improvement over the last two years. i.e. the Owner's equity to Total liabilities and Total assets have shown improvement but marginally. There has been improvement in the long term liabilities position as compared to fixed assets i.e. the firm's degree of leverage has been declining marginally from 2008 to 2010.
Though the leverage position is not a burden for the company at this point of time, the interest paying capability of the firm has been deteriorating over the years. This is not good for the firm and the firm should take necessary actions for improving the same.
what is costs of raw material used.......
Create a description of your company and its primary business activities. Include: a) A brief historical summary b) The lines of business the firm is engaged in (Is the compa
Profit is not cash flow: Adequate cash is essential to keep business running. Inadequate cash increases the risk of not being able to meet current obligations as and when the
Comprehensive Basis of Accounting (OCBOA) - Consistent accounting basis other than GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) used for financial reporting. Illustrations compr
SE CTION A QUESTION 1: Below is a trial balance of a manufacturer of boots for the local market. Trial balance as at 31st December 2012 Dr Rs
Return on Investment (ROI) - Ratio measure of the profits achieved by a firm by its fundamental operations. An indicator of management's general efficiency andeffectiveness. The si
Effects of the appointment of the receiver Floating charges: these crystallise on the appointment of a receiver and become fixed on the assets then in the hands of the compan
During 2012, Kimmel Co. incurred average accumulated expenditures of $600,000 during construction of assets that qualified for capitalization of interest. The only debt outstanding
I am an AAT student studying lvl 3 AAT at college. I wish to learn how to complete self assessment end of year tax return forms for other people. That is because I have already bee
Time tickets for factory employees during the month of August are summarized as follows. Prepare a journal entry to record the total factory payroll, the indirect payroll and the d
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd