Monday, July 20, 2009

CAPITAL STRUCTURE OR LEVERAGE RATIOS

Finaincial strength the soundness of the financial resources of an organisations to perform its operations in the long run. The parties associated with the organisation are intrested in knowing the financial strenth of the organisations. Financial strength is directly associated with the operational ability of the organisations and its efficient management of resources. The financial strength analysis can be made with the help of the following ratios :

  • Debt - Equity Ratio
  • Capital Gearing Ratio
  • Financial Leverage
  • Proprietery Ratio and
  • Intrest Coverage

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