Topic Four, Part 17 - Profitability Ratio

Question 1

What is the formula for gross profit margin?

Answer 1

Gross profit x 100 / sales

Question 2

What is gross profit margin?

Answer 2

How much of sales is profit

Question 3

What is net profit margin?

Answer 3

How much of sales is net profit

Question 4

What is the formula for net profit margin?

Answer 4

Net profit x 100 / sales

Question 5

What is the formula for capital employed/funds employed?

Answer 5

fixed assets + working capital

total assets - current liabilities

Question 6

What is the formula for Return on capital employed (ROCE)?

Answer 6

Operating profit x 100 / capital employed

Question 7

What is the formula for Return on equity (ROE)?

Answer 7

Profit for the year / shareholder equity

Question 8

What is the formula for dividend per share?

Answer 8

Total dividend paid / shares issued

Question 9

What is the formula for Dividend yield?

Answer 9

Dividend per share x 100 / market price per share

Question 10

What is the formula Earnings per share?

Answer 10

Profit for the year / number of shares issued

Question 11

What is the formula for Price earnings ratio?

Answer 11

Market price of share / earnings per share