CPA Financial Ratios: Profitability Ratios

  1. Net Profit Margin =
    • Net Income / Net Sales
    • (profitability)
  2. Return on Total Assets =
    • Net income / Average Total Sales
    • (Profitability)
  3. Return on Assets =
    • Net profit margin x total asset turnover
    • (profitability)
  4. Return on Investment =
    • (Net income + interest expense (1-tax rate)) / (average (long-term liabilities + equity))
    • (profitability)
  5. Return on Common Equity =
    (Net Income - Preferred Dividends) / Average common equity
  6. Net Operating Margin Percentage =
    Net operating income / net sales
  7. Gross (profit) margin percentage =
    gross profit margin / net sales
  8. Operating cash flow per share =
    operating cash flow / common shares outstanding
Author
arnoldb6a
ID
229787
Card Set
CPA Financial Ratios: Profitability Ratios
Description
CPA Financial Ratios: Profitability Ratios
Updated