Computation of Gross Profit; Financial Analysis

Question 1

Identification

is a financial gain from a transaction or from a period of investment or business activity, usually calculated as income in excess of costs or as the final value of an asset in excess of its initial value

Answer 1

Profit

Question 2

Identification

It is a total revenue minus total expenses

Answer 2

Profit

Question 3

Identification

refers to the purchase price of
the product including of the product including
the total outlay required in producing it

Answer 3

Cost

Question 4

Identification

the expenses paid by a business in order to
manufacture a product or provide a service,
and also include fees paid to outside parties to
acquire assets or services.

Answer 4

Outlay

Question 5

Identification

measures the percentage of gross profit to sales, indicating the profit that the business realizes from the sale of the product.

Answer 5

GROSS PROFIT RATE

Question 6

Identification

is the excess of gross
profit from operating expenses

Answer 6

operating profit margin

Question 7

Identification

This is the Income statement

Answer 7

Net Profit Margin

Question 8

Identification

refers to the capacity of the business to pay its short term liability as and when it becomes due.

Answer 8

Liquidity

Question 9

Identification

measures the amount of
net income per peso invested to the business

Answer 9

The Return of investment (ROI)