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profit margin = net income / total revenue

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12y ago

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profitability ratios?

these are ratios which analyze profitability of a company. higher ratios imply higher profitability and value of a company.


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What are operating ratios?

Operating ratios are types of ratios that serve as gauges of a company's operating success (or profitability) for a given period of time. They are also known as profitability ratios.


What are the three types of ratios?

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Is order important when calculating ratios?

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How are ratios classified?

Ratios are often classified using the following terms: profitability ratios (also known as operating ratios), liquidity ratios, and solvency ratios.


Profitability ratios are used to measure?

Profitability ratios are used to measure a company's ability to generate profit relative to its revenue, assets, or equity. These ratios help assess overall financial performance, efficiency in generating earnings, and the effectiveness of management in leveraging resources. Common profitability ratios include the gross profit margin, net profit margin, and return on equity (ROE). By analyzing these ratios, stakeholders can gain insights into a company's operational success and financial health.


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