This essay focuses on operations before interest and tax payments. a better measure of a company’s ability to cover interest and debt payments.
Some analysts use an alternative measure in the numerator of this ratio called EBITDA, which stands for earnings before interest, taxes, depreciation, and amortization. Whether EBITDA is a good substitute for cash flow from operations before interest and tax payments depends on whether there were significant changes in current assets and current liabilities during the period. If significant changes in these accounts occurred during the period, cash flow from before and tax is a better measure of a company’s ability to cover interest and debt payments.
current liabilities are the obligations that will be due within the operating cycle.
Current liabilities are usually report as a separate section of a company’s balance sheet. This allows readers to subtract their total from the company’s total amount
The following are common examples of current liabilities: