Profit margin metrics, return on assets (ROA), and return on equity are a few typical examples of profitability ratios (ROE) .
What parameters define profitability?
- The different types of profit margin, return on assets (ROA), and return on equity are a few prevalent examples of profitability ratios (ROE).Another measure is return on invested capital (ROIC), as well as return on capital employed (ROCE).
- Net sales less the cost of goods sold equals gross profit.Operating Profit is equal to Gross Profit - (Operating Costs, Including Selling and Administrative Expenses)Operating Profit plus any additional income minus additional expenses equals Net Profit (Income Taxes).
- Margins and returns make up the two types of profitability ratios.Income and expenses are two factors that affect profitability.The income statement for a corporation displays its profit; however, profitability is not shown on the statements but is instead determined using the figures on the statements.
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