Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how...
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Transcript of Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how...
![Page 1: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/1.jpg)
Ratio (Finance)Ratio (Finance)
PresentationPresentation
By … Rose 11BFBy … Rose 11BF
![Page 2: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/2.jpg)
Gross Profit RatioGross Profit Ratio
Gross profit ratio use to see how much does the business get profit of a year.
![Page 3: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/3.jpg)
Formula for Gross profit Formula for Gross profit ratioratio
Gross Profit Ratio = (Gross profit/sales)×100
Example :Gross profit=24,000Sales=35,000
Calculation = (24,000/35,000)x100 = 68.57%
![Page 4: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/4.jpg)
Net Profit RatioNet Profit Ratio
The profit that business get – the expenses of the business and tax.
![Page 5: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/5.jpg)
Formula for Net profit ratioFormula for Net profit ratioNet profit ratio = (Net
profit/Sales)x100
Example : Net profit = 12,225Sales = 35,000
Calculation = (12,225/35,000)x100 = 34.93%
![Page 6: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/6.jpg)
Current RatioCurrent Ratio
Current ratio use to see if the business can pay the all debts straight way or not. If the answer is between 1.5 – 2.0 that’s mean the business has enough money to pay all the debts, If the answer is more it’s mean that the business has too much money.
![Page 7: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/7.jpg)
Formula for Current RatioFormula for Current RatioCurrent ratio = Current assets/Current
liabilities
Example : Current assets = 235,000 Current liabilities =
80,000Calculation = 235,000/80,000
= 2.9
![Page 8: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/8.jpg)
The Acid Test RatioThe Acid Test Ratio
The acid test ratio is the same as current ratio but we have to take away the stocks because the stocks is ILLIQUID
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Formula for The Acid Teat Formula for The Acid Teat RatioRatio
The acid test ratio = (current assets-Stock)/current liabilities
Example : current assets = 235,000 stock = 140,000 current liabilities = 80,000
Calculate = (235,000-140,000)/80,000
= 1.19
![Page 10: Ratio (Finance) Presentation By … Rose 11BF. Gross Profit Ratio Gross profit ratio use to see how much does the business get profit of a year.](https://reader036.fdocuments.us/reader036/viewer/2022082819/56649f385503460f94c54569/html5/thumbnails/10.jpg)
Return On Capital EmployedReturn On Capital EmployedReturn On Capital Employed or
ROCE use to see how much money that the business get back from investigating.
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Formula for ROCEFormula for ROCEROCE ratio = (Operating profit/Capital
employed)x100
Example : operating profit = 14,725 capital employed =
555,000Calculation = (14,725/555,000)x100
= 2.65%