Interpret each of the ratios. Review the Financial Ratios Guidelines document for direction. Do you see any red flags? How profitable is the company in relation to sales? How profitable is it in relation to assets? How profitable is it in relation to equity?

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Gross Profit Margin 2018 2019 2020 Industry Average** 38.3 37.8 38.2 (Gross Profit / Sales) Operating Profit Margin (Operating Profit / Sales) 40.1 6.0 4.6 3.4 2.6 Pre-Tax Net Profit Mg 4.9 1.6 2.2 (Pre-Tax Profit** / Sales) 24.8 Pre-Tax Return on Equity (Pre-Tax Profit* / Shareholders Equity) 22.3 23.8 14.8 3.3 Pre-Tax Return on Assets (Pre-Tax Profit** / Total Assets) -14.7 6.5 7.0 6.1 3.5 1.1 -8.8 Gross Profit Margin 2018 2019 2020 Industry Average** 38.3 37.8 38.2 (Gross Profit / Sales) Operating Profit Margin (Operating Profit / Sales) 40.1 6.0 4.6 3.4 2.6 Pre-Tax Net Profit Mg 4.9 1.6 2.2 (Pre-Tax Profit** / Sales) 24.8 Pre-Tax Return on Equity (Pre-Tax Profit* / Shareholders Equity) 22.3 23.8 14.8 3.3 Pre-Tax Return on Assets (Pre-Tax Profit** / Total Assets) -14.7 6.5 7.0 6.1 3.5 1.1 -8.8

Answer rating: 100% (QA)

Gross Profit Margin This ratio measures the companys profit from sales after accounting for the cost of goods sold A higher ratio indicates a greater ability to cover operating expenses and generate p... View the full answer