Mega Manufacturing has calculated the following financial ratios, based on the companys comparative financial statements for 2020 and 2019 Required Briefly explain what each ratio indicates, and comment on the companys performance during this two year period Industry Average 16 2019 2020 Profit mar...

Mega Manufacturing appears to be improving its financial position to be more In line with the perfor ...

Mega Manufacturing has calculated the following financial ratios, based on the companys comparative financial statements for 2020

Question:

Mega Manufacturing has calculated the following financial ratios, based on the company’s comparative financial statements for 2020 and 2019:

Industry Average 16% 2019 2020 Profit margin ratio Return on assets 18% 20% 10% 8% 12% Return on equity 10% 12% 14%

Required
Briefly explain what each ratio indicates, and comment on the company’s performance during this two year period.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...

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