Gearing Ratios Flashcards
1
Q
Financial gearing
A
Total long and short term debt
——————————————x100
Total equity
2
Q
What does financial gearing measure?
A
How much debt the business has and is a measure of financial risk
3
Q
Financial gearing with total debt
A
Total long and short term debt
——————————————x100
Total debt plus total equity
4
Q
Interest cover
A
Profit before interest
——————————
Interest charges
