Stability is the long term prospects of the business surviving.

What is the meaning of the word leverage, as used in accounting?

The long term prospects of the business surviving is termed as stability. Under it, interest coverage ratio and debt ratio can be found out. it is very fruitful.

stability are the important in accounting

Accounting -> Key ratios - stability Key ratios - stability Stability is the long term prospects of the business surviving. Ratio Formula Explanation Stability *Interest coverage ratio Net cash inflow from operations + interest/interest expense This ratio reflects the ability of a firm to meet the interest requirements on borrowed funds. Some texts define this ratio as Net profit + interest/interest expense. Gearing - Debt ratio Total liabilities/total assets Measures the percentage of borrowed funds against total assets.

The long term prospects of the business surviving is termed as stability. Under it, interest coverage ratio and debt ratio can be found out. it is very fruitful.

you will always want your assets to be more then your liabilities once you add everything up. you never want to be in the red.

What is the general effeciency of key ratios?

Stability is the long term prospects of the business surviving.

For the long term stay of any business,its stability ratios must be attain at a positive level.