profitability ratios Flashcards
1
Q
what do profitability ratios show?
A
provides insight into how successful a company is in generating profit
2
Q
what is the equation for gross profit margin? give relevant units.
A
gross profit / revenue
%
3
Q
what is the equation for operating profit margin? give relevant units.
A
operating profit / revenue
%
4
Q
what is the equation for net profit margin? give relevant units.
A
net profit / revenue
%
5
Q
what is the equation for return on assets? give relevant units.
A
net profit / total assets
%
