Quality of Earnings refers to the degree to which a company’s earnings are derived from sustainable and reliable sources, rather than from artificial or non-recurring factors. It is a critical aspect in assessing the true financial health of a business. The quality of earnings ratio formula is often used to evaluate this, calculated as Cash Flow from Operations divided by Net Income. This term fits best in the category of Ratios and Performance Metrics.
CMA Prep Course
CMA Exam Academy is a proven, 16-week per part online coaching program to help you pass the CMA. The Academy’s comprehensive curriculum will help you pass the CMA exam and achieve your dreams of earning 6-figures per year, ascend to the executive ranks and earn the respect from your peers.
