Ros - return on sales-profit margin , Finance Basics

Assignment Help:

ROS - Return on Sales (Profit Margin)

1772_ROS – Return on Sales.png

The Average of the industry ROS was 5.18% for 2004, 4.41% for 2005, and 7.20% for 2006. The chart showed that ROS has been declined from 2004 to 2005, and went up from 2005 to 2006. The major company to bring down the ROS for the industry in 2005 was Lenovo. After it acquired IBM PC division, its sales went up a lot, but it did not working well on its costs. ROS dropped a lot from 4.97% to 0.17% from 2004 to 2005 after the acquisition of IBM PC division. The main reason for fast declining ROS should be suffering from interest expense after the large amount of debt raised for acquire the IBM PC division. Also, The ROS for Lenovo has been lower than industry average for every year leads us to think about the costs as major issue to deal for Lenovo. ((See exhibit ratios)


Related Discussions:- Ros - return on sales-profit margin

Allocation of financial resources, Allocation of financial resources to the...

Allocation of financial resources to the different department can be done based on the past experience of the expenses and other available relevant information. Looking at the requ

Asset management, Which of the following is not considered to be an investm...

Which of the following is not considered to be an investment objective

Types of stock markets, Types of Stock Markets 1. Over the Counter or...

Types of Stock Markets 1. Over the Counter or OTC and Organised Exchange market This is whereas the selling and buying of securities is done through sellers and buyers ar

THE CASE OF THE MISSING BONDS RATING, Three of these companies have bonds t...

Three of these companies have bonds that carry investment - grade ratings. The other 3 companies carry junk - bond ratings. Judging by the information in the table, which 3 compani

Formation of sole proprietorship business, Formation of Sole Proprietorship...

Formation of Sole Proprietorship Business When an individual plans to start a business, his or her main objective is to earn profit but there are a number of factors to take in

T accounts, Accounting Exercise AVM 386 Fall 2014 Misty Mark, an infamous ...

Accounting Exercise AVM 386 Fall 2014 Misty Mark, an infamous archer, decided to open an archery business called Bows and Biceps. The following is a list of transactions for Bows

Finance Project , Five years ago, you bought a house for $151,000, with a d...

Five years ago, you bought a house for $151,000, with a down payment of $30,000, which meant you took out a loan for $121,000. Your interest rate was 5.75% fixed. You would like to

Determine the functions of new issue market, Determine the Functions of New...

Determine the Functions of New Issue Market The key function of new issue market is to facilitate transfer resources from savers to the users. Savers are individuals, insura

Finance functions, Finance Functions The functions of Financial Manage...

Finance Functions The functions of Financial Manager can broadly be split into two:  The Managerial Functions and The Routine functions. Managerial Finance Functions

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd