Financial indicators measure the profitability of a business

Updated on workplace 2024-06-06
8 answers
  1. Anonymous users2024-02-11

    The indicators reflecting the profitability of the enterprise mainly include operating profit margin, cost profit margin, surplus cash guarantee ratio, return on total assets, and return on net assets.

    and six returns on capital; Solvency indicators include short-term solvency indicators and long-term solvency indicators, and the main indicators are current ratios.

    quick ratio and cash flow debt ratio; Indicators of operating capacity include: total asset turnover, current asset turnover, inventory turnover, and accounts receivable turnover.

    Wait. Profitability refers to the ability of an enterprise to obtain profits, also known as the ability of an enterprise to increase its capital or capital, which is usually manifested in the amount of income of an enterprise in a certain period of time and its level. Solvency refers to the ability of a company to repay its long-term and short-term debts with its assets.

    Whether an enterprise has the ability to pay cash and repay debts is the key to the healthy survival and development of an enterprise. An enterprise's solvency is an important indicator of an enterprise's financial status and operating ability. Solvency refers to the ability of an enterprise to repay its debts as they fall due, including its ability to repay both short-term and long-term debts.

    Other factors that affect long-term solvency are as follows:

    1. Long-term lease, when the enterprise urgently needs a certain equipment or plant and lacks sufficient funds, it can solve the problem by leasing the lease without covering the lease;

    2. The forms of property leasing include financial leasing and operating lease.

    Most of the liabilities formed by financial leases are reflected in the balance sheet.

    The operating lease is not reflected in the balance sheet, when the company's operating lease volume is relatively large, the term is relatively long or recurrent, it forms a kind of long-term financing, this long-term financing, rent must be paid when due, will have an impact on the solvency of the enterprise;

    3. Debt guarantee, the length of time of the guarantee project varies;

    4. Some involve the long-term liabilities of the enterprise, and some involve the current liabilities of the enterprise, and when analyzing the long-term solvency of the enterprise, the potential long-term liabilities caused by the guarantee liability should be judged according to the relevant information;

    5. Pending litigation, once the judgment of the pending litigation is lost, it will affect the solvency of the enterprise, so the potential impact should be considered in the evaluation of the long-term solvency of the enterprise.

    Operational capacity refers to the ability of an enterprise to operate and operate, that is, the ability of an enterprise to use various assets to earn profits.

  2. Anonymous users2024-02-10

    Answer]: A asset-liability ratio, also known as debt ratio or debt-to-operation ratio, refers to the ratio of total liabilities to total assets, which is used to measure the ability of Doumu Lu enterprises to use creditors to provide funds for business activities, and reflect the safety of creditors in issuing loans. This ratio is one of the indicators to measure the long-term solvency of a company.

  3. Anonymous users2024-02-09

    Good afternoon, dear, <>

    It is not possible to fully evaluate the solvency of an enterprise by simply using the financial ratio index to calculate and analyze the solvency of an enterprise. The evaluation of the solvency of a company needs to consider many factors, such as the business environment of the enterprise, the competitive situation of the industry, market changes, etc. Although financial ratio indicators can provide some useful information, they only reflect the solvency of enterprises from the financial aspect, and cannot fully reflect the actual situation of enterprises.

    For example, companies may use financial means to disguise their true financial position, which can lead to misleading financial ratio metrics. Therefore, in order to comprehensively evaluate the solvency of an enterprise, it is necessary to comprehensively consider the financial ratio index and other factors, such as the management level of the enterprise, market prospects, industry competition, etc. Only under the comprehensive evaluation of various aspects can the solvency of the enterprise be more accurately assessed, so as to provide a more reliable reference for the investment decision of the enterprise<>

  4. Anonymous users2024-02-08

    Answers]: a, c, d, e

    Solvency is the ability of an enterprise to repay its debts as they fall due, and whether it can repay its debts due in a timely manner is an important indicator of its financial status. Solvency includes short-term solvency and long-term solvency before travel. Short-term solvency ratio:

    Current ratio, quick ratio, and cash ratio. Long-term solvency ratio: debt-to-asset ratio, equity ratio, interest earned multiple.

    Option B: Return on equity is "Profitability."

  5. Anonymous users2024-02-07

    Answer]: c Short-term solvency ratio includes: Current ratio.

    Quick ratio beam bucket stove rate. Cash-flow gearing ratio. The long-term solvency ratio includes:

    Debt-to-asset ratio. Equity ratio. Interest multiplier earned.

  6. Anonymous users2024-02-06

    Answer] :d 2012 construction project Zhiyin economy question 29.

    This question examines the calculation and analysis of basic financial ratios.

    Item D: Solvency mainly reflects the ability of an enterprise to repay its debts as they fall due, and the commonly used indicators include three indicators: asset-liability ratio, current ratio and quick ratio. Therefore, item d is correct.

    Item A: Asset management ratio is an indicator used to measure the company's asset management efficiency, and the commonly used indicators include total asset turnover, current asset turnover, inventory turnover, accounts receivable turnover, etc. Therefore, item A is a measure of the asset management ratio and should not be selected.

    Item B: Profitability refers to the ability of an enterprise to earn profits, and the commonly used indicators are return on net assets and return on total assets. Therefore, item B is an indicator to evaluate the profitability of the enterprise and should not be selected.

    Item C: The balancing indicators of enterprise development ability mainly include business growth and capital accumulation rate. Therefore, item C is an indicator to measure the development ability of the enterprise and should not be selected.

    To sum up, the correct answer to this question is item d.

  7. Anonymous users2024-02-05

    Summary. First, short-term solvency indicators.

    Current Ratio = Current Assets Current Liabilities.

    Quick Ratio = (Current Assets – Inventories) Current Liabilities.

    Cash Ratio = (Cash + Valuable**) Current Liabilities.

    2. Long-term solvency indicators.

    Asset-liability ratio = liabilities and assets * 100%.

    Equity Ratio = Liabilities Owner's Equity * 100%.

    Interest protection ratio = (profit before tax + interest expense) interest before tax.

    Fixed Expenses Coverage Ratio = (Pre-tax Profit + Fixed Expenses) Fixed Expenses.

    A calculation of the impact of profitability on long-term solvency.

    1. Short-term solvency indicator current ratio = current assets current liabilities quick ratio = (current assets - inventory) current liabilities cash ratio = (cash + valuable**) current liabilities.

    2. Long-term solvency index: asset-liability ratio = liabilities Assets * 100% equity ratio = liabilities Owner's equity * 100% interest protection multiple = (pre-tax profit + interest expense) Pre-tax interest fixed expenditure guarantee multiple = (pre-tax profit + high fixed expenditure) Fixed expenses.

    Third, the profitability index return on net assets = net profit Owner's equity average balance * 100% return on total assets = net profit Average balance of total assets * 100% sales profit margin = sales revenue - sales cost sales revenue * 100% cost expense rate = sales revenue - cost of sales cost * 100% Fourth, the total asset turnover rate of the operating capacity index = operating income The average balance of total assets, the turnover rate of current assets = operating income, the average balance of current assets, the turnover rate of accounts receivable =Operating income Average balance of accounts receivable before leveling Accounts receivable turnover days = 360 Accounts receivable turnover ratio Inventory turnover ratio = operating cost Average balance of inventory turnover days = 360 Inventory turnover ratio.

    This is a question of financial analysis, and it is sure to be right.

    Yes, dear. Good.

  8. Anonymous users2024-02-04

    Summary. Solvency, operation, profitability and development ability are important indicators in the financial management of enterprises, and there is a close relationship between them and financial performance. Solvency refers to a business's ability to repay its debts on time when they become due.

    Solvent companies gain more trust and support, which in turn improves their credibility and market competitiveness, which in turn improves their financial performance. Operational capacity refers to the ability of an enterprise to obtain revenue in the course of normal business activities. Operational companies are better able to control costs and risks, improve operational efficiency and profitability, and thus improve financial performance.

    Profitability refers to the profitability that a business obtains in its business activities. Profitable companies are better able to reward shareholders and investors, increase their market value and competitiveness, and in turn improve their financial performance. Development capability refers to the potential and ability that an enterprise has in its future development.

    Enterprises with strong development capabilities can better adapt to market changes and development trends, improve their innovation ability and competitiveness, and then promote the improvement of financial performance. Therefore, solvency, operation, profitability and development ability are indispensable indicators in the financial management of enterprises, which influence and promote each other to jointly promote the continuous improvement of financial performance of enterprises. <>

    The relationship between solvency, operating ability, profitability, development capacity and financial performance.

    Good. Solvency, operation, profitability and development ability are important indicators in the financial management of enterprises, and there is a close relationship between them and financial performance. Solvency refers to a business's ability to repay its debts on time when they become due.

    Solvent companies gain more trust and support, which in turn improves their credibility and market competitiveness, which in turn improves their financial performance. Operational capacity refers to the ability of an enterprise to obtain revenue in the course of normal business activities. Operational companies are better able to control costs and risks, improve operational efficiency and profitability, and thus improve financial performance.

    Profitability refers to the profitability of an enterprise in its business activities. Profitable companies are better able to reward shareholders and investors, increase their market value and competitiveness, and in turn improve their financial performance. Development capability refers to the potential and ability that an enterprise has in its future development.

    Enterprises with strong development capabilities can better adapt to market changes and development trends, improve their innovation ability and competitiveness, and then promote the improvement of financial performance. Therefore, solvency, operation, profitability and development ability are indispensable indicators in the financial management of enterprises, which influence and promote each other to jointly promote the continuous improvement of financial performance of enterprises. <>

    Okay. Kiss Did you say anything, I gave you your previous question a long time ago, haven't you seen it yet, <>

    Is it just a close relationship?

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