2023 2024 EduVark > Education Discussion > General Discussion


  #2  
February 8th, 2016, 12:46 PM
Super Moderator
 
Join Date: Mar 2012
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


Quick Reply
Your Username: Click here to log in

Message:
Options



All times are GMT +5. The time now is 06:35 PM.


Powered by vBulletin® Version 3.8.11
Copyright ©2000 - 2024, vBulletin Solutions Inc.
Content Relevant URLs by vBSEO 3.6.0

1 2 3 4 5 6 7 8