Calculation of profitability ratios, Financial Accounting

 

Calculation of Profitability ratios  -

     
         
   

2008

2009

2010

G

Net Sales

8506616

11993699

16064038

H

Gross Profit

2145345

2940480

3782294

I

Net Profit

327743

450086

627643

J

EBIT or Operating Profit (Net)

660135

935835

1182927

K

Equity

1277659

1690493

2257267

L

Total Assets

3103645

4049092

5131809

         
         
 

Net Profit Margin ( I / G)

3.85%

3.75%

3.91%

         
 

Gross Profit Margin (H / G)

25.22%

24.52%

23.55%

         
 

Return on Equity (I / K)

25.65%

26.62%

27.81%

         
 

Return on Total Assets (J / L)

21.27%

23.11%

23.05%

As shown by above, out of the four ratios except Gross Profit Margin all other ratios have improved in 2010 as compared to 2008. However, both the Net margin and the Gross margin have declined in 2009 as compared to 2010. The company has shown better performance in terms of return on equity as well as return on total assets in both the years i.e. 2009 and 2010 as compared to 2008.

Overall, it can be said that 2010 has been a good year for the company in terms of profitability and overall the company has been moderately profitable with marginal increase in profit percentages.

 

Posted Date: 7/26/2012 5:57:12 AM | Location : United States







Related Discussions:- Calculation of profitability ratios, Assignment Help, Ask Question on Calculation of profitability ratios, Get Answer, Expert's Help, Calculation of profitability ratios Discussions

Write discussion on Calculation of profitability ratios
Your posts are moderated
Related Questions
Q. Average cost of capital? Even though the director suggests that equity finance is appropriate given the amount of finance needed the amount alone doesn't rule out other fina

Suppose that Oxford Inc. is interested in the two new products, AME and CGK. Because of its capital budget constraint, it can only launch one new product line. Eric just graduated

Which of the following actions are most likely to directly increase cash as shown on a firm's balance sheet? Explain and state the assumptions that underlie your answer. 1. It i

COMPOSITIONS AND SCHEMES OF ARRANGEMENT The debtor may lodge a written proposal with the Official Receiver for a composition or other arrangement of his affairs within four day


Alexandria Co. Ltd has an authorized capital of Rs 25,000,000 divided into 250,000 equity shares of Rs 100 each. 100,000 shares were issued to public and Rs 80 per share were paid.

A stock is about to pay a dividend of $2.00. The dividend is expected to grow at 15% for the next 7 years, 10% for the following 3 years, 8% for the next 2 years and then return to

Does a state have the authority to require a U.S.-based multinational corporation to compute its state taxable income on a worldwide combined reporting basis? What about a foreign-

Q. The capital investment appraisal techniques such as NPV, IRR, ARR, PV and Time value of money have become irrelevant post Celtic Tiger. Due to the depth of the recession comp

methods of preparation of trial balance