Recent Articles

Debt to Equity Ratio

Debt to Equity ratio is the numerical value associated with all debt divided by the value of the equity section on the balance sheet. Most prudent investors are more concerned with a limited perspective of just the long-term debt against the entire equity.

Interest Coverage Ratio

01/09/2017

The last of the leverage ratios isn’t really a pure leverage indicator but augments the debt ratio.  Debt requires the payment of interest and so an indicator of the ability to pay this interest is needed.  This is the interest coverage [...]

Debt to Equity Ratio

12/31/2016

Another leverage ratio used to evaluate the financial integrity of a business is the debt to equity ratio.   It is strictly a bottom half balance sheet ratio.   Its result explains the relationship of volume of debt and corresponding equity to [...]

Long Term Debt – Explanation and General Understanding

01/06/2015

In the arsenal of capitalizing a business operation, long term debt serves as one of the primary sources of capital.  As an owner of a small business, you need to understand the relationship this source has to the overall financial status of the [...]