Measure of how profitable a company is relative

Measure of how profitable a company is relative


ROE =

 

·         NI/TE

 

ROA =

 

·         NI/TA

 

Equity Multiplier =

 

·         TA/TE

 

Profit Margin =

 

·         NI/Sales

 

TA Turnover =

 

·         Sales/TA

 

ROE

 

·         1

 

ROA

 

·         2

 

Equity Multiplier

 

·         3

 

Profit Margin

 

·         4

 

 

TA Turnover

 

·         5

 

ROE is

 

·         a measure of the profitability of a business in relation to the equity

 

ROA is

 

·         an measure of how profitable a company is relative to its total assets

 

Equity Multiplier is

 

·         a risk indicator that measures the portion of a company's assets that is financed by stockholder's equity rather than by debt

 

Profit Margin is

 

·         the amount by which revenue from sales exceeds costs in a business

 

TA Turnover is

 

·         a measure of how effectively companies are using their assets to generate sales

 

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