The following article will guide you to learn about how to calculate standard deviation and coefficient of variation. Standard deviation is a statistical technique used in capital budgeting decisions to determine the variation or deviation from the mean of cash flows of the project. The project with lesser standard deviation in cash flows carries less risk and uncertainty. Risk is [...]
The below mentioned article provides a formula to calculate the Sustainable Growth Rate (SGR) of a firm. SGR is the maximum growth rate which can be achieved by using both internal accruals, as well as, external debt without increasing the financial leverage. SGR is the maximum sales that can be achieved in a year based on target operating debt and [...]
EFR is calculated with the help of following formula, when other ratios remain constant: Where, A/S = Total assets/Sales Total assets include both current assets and fixed assets L/S = Current liabilities and provisions/Sales S = Sales of current year S1 = Projected sales of next year ΔS = Expected increase in sales over current year (S-S1) M = Net [...]