The operational cash flow margin of your company is an essential metric that shows you how steady your earnings have been over time. In the case of a $25,000 monthly sales volume, but half of those sales are being returned on a regular basis, it is not a healthy cash flow situation. By measuring your … Read more
In order to establish a company’s operating cash flow ratio, cash flows generated by the company’s operations are taken into account. Short-term liquidity can be estimated using this ratio for a company’s short-term liquidity. Because earnings can be easily manipulated, it is more accurate to evaluate cash flow rather than net income in order to … Read more
When a company’s ability to make interest payments on its outstanding debt is examined, it is referred to as the interest coverage ratio (ICR). The interest coverage ratio is computed by comparing a company’s debt to its revenue. When a corporation’s pre-tax earnings are divided by the interest expense incurred over a certain period, the … Read more
Fixed asset turnover ratio (FATR) is a measure of a company’s operational efficiency that is often used by analysts. In order tomeasure how well a company can produce sales from its investments in fixed assets, such as property, plant, and equipment (PP&E), netsales are compared to fixed assets on the balance sheet (PP&E). The fixed … Read more