Gross profit margin x 100/sales revenue. For every £1 in sales the money goes to gross profit. Managers are intrested in this as they want to see how the business is performing and will stuff get paid
1 of 5
Net profit margin
Net profit margin x 100/sales revenue. For every £1 in sales it goes to net profit. Stakeholders want to know if the business is making profit
2 of 5
Return of capital employeed
Net profit x 100/capital employeed. Profit created from each £1 invested. Shareholders - is investment providing as good a return as other options.
3 of 5
Current ratio
Current assests/current liabilities. How easily a firm’s short-term debts can be paid from current assets.
4 of 5
Acid ratio test
Current assets - stock/current liabilities. Removes stock from the equation to give a more realistic measure.
5 of 5
Other cards in this set
Card 2
Front
Net profit margin x 100/sales revenue. For every £1 in sales it goes to net profit. Stakeholders want to know if the business is making profit
Back
Net profit margin
Card 3
Front
Net profit x 100/capital employeed. Profit created from each £1 invested. Shareholders - is investment providing as good a return as other options.
Back
Card 4
Front
Current assests/current liabilities. How easily a firm’s short-term debts can be paid from current assets.
Back
Card 5
Front
Current assets - stock/current liabilities. Removes stock from the equation to give a more realistic measure.
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