Key areas of financial performance.

CKCharuka kumarasiri.7y ago

Hi sir, The lecture notes said that the key areas of financial performance are profitability, liquidity and gearing. I recently went through the Kaplan study text, instead of gearing it had the asset turnover. I'm a bit confused, could you please clarify.

C-Cath - CIMA Tutor7y ago#1

Hi, The asset turnover ratio measures the efficiency of the company at generating revenue- eg how many dollars does it earn in sales given the asset investment involved. Therefore, this could fall under the heading of profitability. Many Thanks

CKCharuka kumarasiri.7y ago#2

Thank you, sir, I got the point.

C-Cath - CIMA Tutor7y ago#3

Great - thanks

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