Earnings Before Tax / Earnings Before Interest and Tax
It provides a comparative measure of the cost of debt.
what is ratio analysis
gearing is where a company analyses its financial expenditure on its operations
Importance of financial ratio analysis on investment decision making?
it manages our financial cost and investment and also gives us profit ratio.
it mean the cost of sale sale of company increase or the direct cost increase
Monitoring and maintaining a healthy debt ratio in personal finance is important because it helps individuals manage their debt responsibly and avoid financial strain. A healthy debt ratio indicates that a person is not overburdened with debt, which can lead to financial instability and difficulty in meeting financial obligations. By keeping a healthy debt ratio, individuals can better control their finances, build a good credit score, and achieve long-term financial stability.
cost of capital,financial leverage,capital budgeting appraisal methods,ABC analysis,ratio analysis and cash flow statements.
Maintaining a healthy debt ratio in personal finance is important because it helps individuals manage their debt responsibly and avoid financial strain. A healthy debt ratio indicates that a person is not borrowing more money than they can afford to repay, which can lead to financial stability and better credit scores.
How do i start answering this question?
Cost Ratio = expenses/earnings
Yes, a low debt to equity ratio is generally preferred for a more stable financial situation. This ratio indicates lower financial risk and a stronger financial position.
scope of ratio analysis