What does Net cash Inflow from operations mean?
a company would seek to increasing it's sale of goods and services, extended warranty, promotions etc. dispose by sale of sitting assets operational but not in demand by the company to warrant additional revenue and also seek to cut back on unnecessary expenditure.
explain of stability ratios and it's furmula?
this needs an affective plan of borrowing and funds of the assets
Accounting - Key ratios - stability
Key ratios - stability
Stability is the long term prospects of the business surviving.
*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.
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