Assume that all you have available are data for the following ratios and your firm and your
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Question:
Assume that all you have available are data for the following ratios and your firm and your industry.
| Total Asset Turnover | = Revenues/Assets |
| Total Margin | = EBIT/Revenues |
| Net Profit Margin | = Earnings/Revenues |
| Times Interest Earned | = EBIT/Interest |
| Return on Equity | = Earnings/Equity |
If you want to evaluate the financial risk of your company and you can only use one of the measures, which one would it be and why?
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