Question
A company reports an EBIT (Earnings Before Interest and Tax) of ₹10,00,000. It incurs interest charges of ₹2,00,000. The company also pays a Preference Dividend of ₹1,00,000 and an Equity Dividend of ₹7,00,000. On the basis of this information, calculate the Financial Leverage.
More Financial Statement Analysis Questions
- A company has sales ₹50,00,000 and gross profit margin 40% (on sales). Cost of goods sold (COGS) is:
- A company’s debt-to-equity ratio increases from 1.5 to 2.5 over the year. What can be a likely interpretation?
- Sales = ₹200 lakhs, Variable cost = ₹120 lakhs, Fixed cost = ₹30 lakhs Interest = ₹10 lakhs Calculate (i) Operating Leverage and (ii) Financial Leverage.
- A firm uses 70% debt financing at 10% interest. Its ROE rises despite flat operating profits. What explains this phenomenon?
- While preparing cash flow statement, an entity (other than a financial institution) should disclose the dividends received from its investment in shares as...
- A company has a Current Ratio of 2.5:1 and Liquid Ratio of 1.5:1. If its Current Liabilities are ₹4,00,000, the value of Inventory will be:
- Current ratio = 1.5 and current assets = ₹3,00,000. Current liabilities are:
- A company's EBITDA is ₹18,00,000, depreciation ₹2,00,000, interest ₹1,00,000, tax 30%. Net profit after tax (approx) is:
- XYZ Ltd. has the following details: Equity Share Capital = ₹50 lakhs, Reserves = ₹20 lakhs, Long-term Debt = ₹30 lakhs. EBIT for the year is ₹18 lakhs, and...
- A company’s Balance Sheet shows the following figures: • Current Assets amounting to ₹12,00,000, which include an Inventory balance of ₹3,00,000. • Curre...
Hey! Ask a query
Please enter email id
The email must be a valid email address.
Please enter Mobile Number
Please enter valid Mobile Number
Please enter your Doubt