Performance Management Flashcards
1
Q
Two basic ways to improve profits
A
First, by increasing the amount of profit for each dollar or sales.
Second, by making better use of assets to generate more sales
2
Q
operating profit margin
A
Operating Profit / Net Sales
3
Q
Days sales in inventory
A
1) COGS / 365
2) take average Inventory / #1
4
Q
ROA
A
net income divided by total assets
5
Q
ROE
A
net income divided by total equity
6
Q
Net profit margin
A
net income divided by net sales
7
Q
ROIC (Return on Invested Capital)
A
is the net income of a company plus its interest expense for the period
8
Q
Invested capital is equal to
A
interest bearing debt plus shareholders equity
9
Q
Dividend Payout Ratio
A
Cash Dividend per share / EPS
10
Q
times interest earned
A
Operating Profit / Income Expense
