Profitability Ratios Profitability ratios measure two aspects of a corporation’s profits: (1) those elements of operations that contribute to profit and (2) the relationship of profit to total investment and investment by stockholders. The first group of profitability ratios [gross profit (or gross margin) percentage‚ operating margin percentage‚ and net profit margin percentage] expresses income statement elements as percentages of net sales. The second group of profitability ratios (return on assets
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The Golden Ratio Body‚ art‚ music‚ architecture‚ nature – all connected by a simple irrational number – the Golden Ratio. According to Posamentier & Lehmann in their work The (Fabulous) Fibonacci Numbers‚ there is reason to believe that the letter φ (phi) was used because it is the first letter of the name of the celebrated Greek sculptor Phidias (490-430 BCE). He produced the famous statue of Zeus in the Temple of Olympia and supervised the construction of the Parthenon in Athens
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Methods used by Tesco to monitor if good customer service is taking place. If Tesco’s know how good or bad their customer service is then they can make improvements where appropriate. Since they are in such a competitive market they must monitor regularly and act fast on anything which needs improving. Tesco’s is such a big company it will be hard to monitor the customer service in all the stores‚ but an easy and efficient way of doing this is to use mystery shoppers. This is basically when a researcher
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Ratio Worksheet 1. a. Split £10 into the ratio 2 : 3 c. Split 50 sweets into the ratio 9 : 1 e. Split 2.50m into the ratio 3 : 2 g. Divide 56kg into the ratio 2 : 5 : 1 i. Divide 75 birds into the ratio 8 : 5 : 2 k. Split 3kg 600g into the ratio 1 : 2 : 3 b. Split £48 into the ratio 3 : 5 d. Change 250ml into the ratio 7 : 3 f. Change £6.60 into the ratio 5 : 6 h. Split £100 into the ratio 5 : 4 : 1 j. Divide 1.20m in the ratio 2 : 3 : 4 l. Split 1 hr 20 mins into the ratio 1 : 4
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the Golden Ratio The golden ration can occur anywhere. The golden proportion is the ratio of the shorter length to the longer length which equals the ratio of the longer length to the sum of both lengths. The golden ratio is a term used to describe proportioning in a piece. In a work of art or architecture‚ if one maintained a ratio of small elements to larger elements that was the same as the ratio of larger elements to the whole‚ the end result was pleasing to the eye. The ratio for length
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PROBLEMS 1. The following three one year “discount” loans are available to you: Loan A: $120‚000 at a 7 percent discount rate Loan B: $110‚000 at a 6 percent discount rate Loan C: $130‚000 at a 6.5 percent discount rate a. Determine the dollar amount of interest you would pay on each loan and indicate the amount of net proceeds each loan would provide. Which loan would provide you with the most upfront money when the loan takes place? Loan A: 120‚000 – 8400 = 111‚600. Loan
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1. Current Ratio- the current ratio is current assets divided by current liabilities. In the data from 2002 in Appendix D the current assets equal $104‚296.00 and the current liabilities equal $139‚017.00 the current ratio equals 0.75. 2. Long –term solvency ratio- the formula used for long term solvency is total assets divided by total liabilities. In the data provided the total assets equal $391‚270.00 and the total liabilities equal $310‚246.00 making the long-term solvency ratio equal 1.26
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Stockholder Ratios Stockholders are primarily interested in two things: (1) The creation of value‚ and (2) The distribution of value. Stockholder ratios such as earnings per share and return on common equity provide information about the creation of value for shareholders. The value is distributed to shareholders in one of two ways. Either the corporation issues dividends or repurchases stock. The remainder of the stockholder ratios—dividend yield‚ dividend payout‚ stock repurchase payout
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PROFITABILITY RATIOS One of the most important measures of a company’s success is its profitability. However‚ individual figures shown in the income statement/profit and loss account for gross profit and net profit mean very little by themselves. When these profit figures are expressed as a percentage of sales‚ they are more useful. This percentage can then be compared with those of previous years‚ or with the percentages of other similar companies. Changes in the gross profit percentage ratio can be
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evaluate how well it is performing‚ one of those tools is the debt ratio calculation. The debt ratio shows the proportion of assets financed with debt‚ liabilities. It is calculated by the companies total liabilities divided by its total assets and is used as a percentage. Total assets and total debts can be found on the balance sheet. “It can be used to evaluate a business’s ability to pay its debt” (Nobles p. 89). The debt ratio can be used to evaluate a business’s ability to pay it’s debts.
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