In this article we will discuss about interest cover and income gearing in a company. Interest Cover: This ratio is calculated to analyse the company's ability to meet interest obligations. It is expressed as number of times interest earned. It is measured as a ratio of profit before interest and tax to interest charges. The more the number of times [...]
The following points highlight the top seven methods used for evaluating the investment proposals by a company. The methods are: 1. Payback Period Method 2. Accounting Rate of Return Method 3. Net Present Value Method 4. Internal Rate of Return Method 5. Profitability Index Method 6. Discounted Payback Period Method 7. Adjusted Present Value Method. 1. Payback Period Method: The [...]
After the feasibility studies are carried out, a detailed project report (DPR) is required to be drawn up based on the data and results obtained from the studies. The preparation of the DPR is the final and most important stage of pre-investment phase of project. It is on the basis of the DPR, the Project Investments Board and the Cabinet [...]