Profitability ratios

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8 Terms

1
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Return on common stockholders equity

net income-preferred dividends/average common stockholders equity

2
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return on assets

net income/average total assets

3
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profit margin

net income/net sales

4
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asset turnover

net sales/average total assets

5
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gross profit rate

gross profit/net sales

6
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Earnings per share

Net income-preferred dividends/weighted average common shares outstanding

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price earnings ratio

market price per share/earnings per share

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payout ratio

cash dividends paid on common stock/net income