Financial (Risk/Solvency) Ratios Flashcards by melissa siemonek | Brainscape

Q

How is gearing calculated?

A

Long term liabilities/equity + long term liabilities x 100

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Q

How is debt equity ratio calculated? (leverage)

A

Long term debt/equity

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Q

How is dividend cover calculated (times)?

A

Profit before gross interest and tax/gross interest payable

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Q

How is interest cover (times) calculated?

A

Profit before gross interest and tax/gross interest payable

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Q

How is cash interest cover (times) calculated?

A

Net cash inflow from operations + interest received / interest paid

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