![]() |
|
Financial Terms | |
Basic Earnings Power Ratio |
Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
Main Page: credit, tax advisor, inventory control, finance, accounting, payroll, financial, financial advisor, Also see related: home financing, buy home, mortgage, property, insurance, condo, homebuying, credit, homes, |
Definition of Basic Earnings Power RatioBasic Earnings Power RatioPercentage of earnings relative to total assets; indication of how
Related Terms:"Soft" Capital RationingCapital rationing that under certain circumstances can be violated or even viewed Abusive Earnings ManagementThe use of various forms of gimmickry to distort a company's true financial performance in order to achieve a desired result. Abusive Earnings ManagementA characterization used by the Securities and Exchange Acceleration ClauseClause causing repayment of a debt, if specified events occur or are not met. Accelerationist HypothesisBelief that an effort to keep unemployment below its natural rate results in an accelerating inflation. Accounting earningsearnings of a firm as reported on its income statement. accounts receivable turnover ratioA ratio computed by dividing annual ![]() Acid-test ratioAlso called the quick ratio, the ratio of current assets minus inventories, accruals, and prepaid ACID-TEST RATIOA ratio that shows how well a company could pay its current debts using only its most liquid or “quick” assets. It’s a more pessimistic—but also realistic—measure of safety than the current ratio, because it ignores sluggish, hard-toliquidate current assets like inventory and notes receivable. Here’s the formula: Acid-test RatioSee quick ratio acid test ratio (also called the quick ratio)The sum of cash, accounts receivable, and short-term marketable Adjusted Cash Flow Provided by Continuing OperationsCash flow provided by operating Adjusted EarningsNet income adjusted to exclude selected nonrecurring and noncash items of reserve, gain, expense, and loss. Appraisal ratioThe signal-to-noise ratio of an analyst's forecasts. The ratio of alpha to residual standard Articles of incorporationLegal document establishing a corporation and its structure and purpose. Asset activity ratiosratios that measure how effectively the firm is managing its assets. ![]() Asset/equity ratioThe ratio of total assets to stockholder equity. asset turnover ratioA broad-gauge ratio computed by dividing annual Basic balanceIn a balance of payments, the basic balance is the net balance of the combination of the current Basic business strategiesKey strategies a firm intends to pursue in carrying out its business plan. basic earnings per share (EPS)This important ratio equals the net Basic IRR ruleAccept the project if IRR is greater than the discount rate; reject the project is lower than the Benefit Ratio MethodThe proportion of unemployment benefits paid to a company’s Benefit Wage Ratio MethodThe proportion of total taxable wages for laid off Canadian Deposit Insurance CorporationBetter known as CDIC, this is an organization which insures qualifying deposits and GICs at savings institutions, mainly banks and trust companys, which belong to the CDIC for amounts up to $60,000 and for terms of up to five years. Many types of deposits are not insured, such as mortgage-backed deposits, annuities of duration of more than five years, and mutual funds. Capital rationingPlacing one or more limits on the amount of new investment undertaken by a firm, either capital rationinga condition that exists when there is an ![]() capital rationingLimit set on the amount of funds available for investment. Capitalization ratiosAlso called financial leverage ratios, these ratios compare debt to total capitalization Cash flow coverage ratioThe number of times that financial obligations (for interest, principal payments, Cash flow from operationsA firm's net cash inflow resulting directly from its regular operations Cash Flow–to–Income Ratio (CFI)Adjusted cash flow provided by continuing operations CASH FLOWS FROM OPERATIONSA section on the cash-flow Stockholders’ equity statement that shows how much cash came into a company and how much went out during the normal course of business. Cash ratioThe proportion of a firm's assets held as cash. Cash Ratioratio of cash and cash equivalents to liabilities; in the case of a bank, the ratio of cash to total deposit liabilities. Common stock ratiosratios that are designed to measure the relative claims of stockholders to earnings Concentration accountA single centralized account into which funds collected at regional locations concentration bankingSystem whereby customers make payments to a regional collection center which transfers funds to Concentration servicesMovement of cash from different lockbox locations into a single concentration Configuration auditA review of all engineering documentation used as the basis Configuration controlVerifying that a delivered product matches authorizing contribution margin ratiothe proportion of each revenue dollar remaining after variable costs have been covered; Controlled foreign corporation (CFC)A foreign corporation whose voting stock is more than 50% owned Conversion ratioThe number of shares of common stock that the security holder will receive from Core EarningsA measure of earnings that includes only the results of the primary operating CorporationA legal "person" that is separate and distinct from its owners. A corporation is allowed to own CorporationA legal entity, organized under state laws, whose investors purchase corporationBusiness owned by stockholders who are not personally Cost-benefit ratioThe net present value of an investment divided by the investment's initial cost. Also called Cost Plus Estimated Earnings in Excess of BillingsRevenue recognized to date under the percentage-of-completion method in excess of amounts billed. Also known as unbilled accounts Coverage ratiosratios used to test the adequacy of cash flows generated through earnings for purposes of Credit RationingRestriction of loans by lenders so that not all borrowers willing to pay the current interest rate are able to obtain loans. Current ratioIndicator of short-term debt paying ability. Determined by dividing current assets by current Current ratioA ratio that shows how many times a company could pay its current debts if it used its current assets to pay them. The formula: current ratioCalculated to assess the short-term solvency, or debt-paying Current RatioA measure of the ability of a company to use its current assets to Current RatioCurrent assets divided by current liabilities. This ratio indicates the extent to which the claims of short-term creditors are covered by assets expected to be converted to cash in the near future. Customary payout ratiosA range of payout ratios that is typical based on an analysis of comparable firms. Days' sales in inventory ratioThe average number of days' worth of sales that is held in inventory. Debt/equity ratioIndicator of financial leverage. Compares assets provided by creditors to assets provided Debt/Equity RatioA comparison of debt to equity in a company's capital structure. Debt ratioTotal debt divided by total assets. Debt RatioThe percentage of debt that is used in the total capitalization of a Debt-service coverage ratioearnings before interest and income taxes plus one-third rental charges, divided debt-to-equity ratioA widely used financial statement ratio to assess the Declaration dateThe date on which a firm's directors meet and announce the date and amount of the next Declaration dateThe date on which the board of directors has declared a dividend. diluted earnings per share (EPS)This measure of earnings per share Discontinued operationA business segment that has been or is planned to be closed or sold off. Discontinued OperationsNet income and the gain or loss on disposal of a business segment whose assets and operations are clearly distinguishable from the other assets and operations of an entity. Dividend payout ratioPercentage of earnings paid out as dividends. dividend payout ratioComputed by dividing cash dividends for the year dividend payout ratioPercentage of earnings paid out as dividends. dividend yield ratioCash dividends paid by a business over the most Dollar durationThe product of modified duration and the initial price. Domestic International Sales Corporation (DISC)A U.S. corporation that receives a tax incentive for DurationA common gauge of the price sensitivity of an asset or portfolio to a change in interest rates. DurationThe weighted average of the time until maturity of each of the DurationThe expected life of a fixed-income security considering its coupon DurationThe time it takes for a policy or annuity to reach maturity. Earning powerearnings before interest and taxes (EBIT) divided by total assets. Earning PowerA company's ability to generate a sustainable, and likely growing, stream of Earning PowerA company's ability to generate a sustainable, and likely growing, stream of EarningsNet income for the company during the period. EarningsIn general, refers to a company's total sales less cost of sales and operating expenses, including interest and income tax. earnings before interest and income tax (EBIT)A measure of profit that Earnings before interest and taxes (EBIT)A financial measure defined as revenues less cost of goods sold Earnings before interest and taxes (EBIT)The operating profit before deducting interest and tax. Earnings before interest, taxes, depreciation and amortization (EBITDA)The operating profit before deducting interest, tax, depreciation and amortization. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)An earningsbased measure that, for many, serves as a surrogate for cash flow. Actually consists of working Earnings ManagementThe active manipulation of earnings toward a predetermined target. Earnings per ShareA measure of the earnings generated by a company on a per Earnings per share (EPS)EPS, as it is called, is a company's profit divided by its number of outstanding earnings per share (EPS)See basic earnings per share and diluted earnings per share. Earnings per share of common stockHow much profit a company made on each share of common stock this year. Earnings retention ratioPlowback rate. Earnings surprisesPositive or negative differences from the consensus forecast of earnings by institutions Earnings yieldThe ratio of earnings per share after allowing for tax and interest payments on fixed interest EBBS - Earnings before the bad stuffAn acronym attributed to a member of the Securities and Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |