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The debt ratio is a measure of a firms what?
Leverage
What are four major financial ratios?
Liquidity, Profitability, Leverage, and Activity/Efficiency
Should firms with higher business risk have lower leverage?
yes
What types of firms or what industry sectors might it be prudent to limit operating leverage?
susmita
What does a negative ROA mean?
ROA is an indication of a firms profitability and sustainability. Those organizations that have a negative ROA may not be able to sustain their operations overtime.
The debt ratio is a measure of a firms what?
Leverage
What are four major financial ratios?
Liquidity, Profitability, Leverage, and Activity/Efficiency
What do you mean by leverage?
basically leverage is the employment of assets or sources of finance for which firms pays fixed cost or fixed return.
Should firms with higher business risk have lower leverage?
yes
Using McKesson 10k and 10q calculate the profitability liquidity leverage and activity ratios and assess the significance of any trends?
What are the liquidity leverage for mckesson suing 10q?
Does financial leverage always increase the earning per share?
no, not for loss making firms
What types of firms or what industry sectors might it be prudent to limit operating leverage?
susmita
Which principle affects the average profitability possible of a market segment?
Competitive Intensity
How do small firms survive?
Small firms survive by producing quality products. They also leverage any other competitive advantage they may have in the industry.
How can leverage be used to increase an organization's profitabililty?
Leverage, in the sense of this question, is borrowing money to help your business growth by buying new machinery, buying another business, etc. Leverage won't directly increase your business's profitability, it can be used to buy more than you can currently afford with cash reserves. If the new purchase will pay back the lender who gave you the money to purchase it, plus pay the costs of having it, with money left over then you have increased your profitability. If you changed the question to: 'How can borrowed money be used to increase an organization's profitability?' then you can see my point more clearly.
Which financial ratio is the most helpful when determining which company to invest money into is it liquidity profitability leverage or activity ratio.?
E/P i think,
WHAT measure would be most useful in comparing the operating profitability of two firms in different industries?
cash in divided by cash out
