#1
February 8th, 2016, 12:37 PM
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Profitability Ratios Formula
Hello sir I want to know Profitability ratios formula so here can you please give me its details ?
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#2
February 8th, 2016, 12:46 PM
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Re: Profitability Ratios Formula
Hey as A profitability ratio is a measure of profitability, which is a way to measure a company's performance. Profitability ratios formula Gross Margin Gross margin tells you about the profitability of your goods and services Gross Margin = Gross Profit/Net Sales * 100 GM = GP / NS * 100 Operating Margin Operating Margin is calculated by dividing your operating profit (OP) by your net sales (NS) and multiplying the quotient by 100: Operating Margin = Operating Profit / Net Sales * 100 OM = OP / NS * 100 Return on Assets Return on Assets measures how effectively the company produces income from its assets Return on Assets = Net Income / Assets * 100 ROA = NI/A * 100 Return on Equity Return on equity measures how much a company makes for each dollar that investors put into it Return on Equity = Net Income / Shareholder Investment * 100 ROE = NI / SI * 100 |