Ratios - Cash flow Margin=Cash from operating...

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In terms of Leverage: Dupont System Net Profit Margin=NI/Sales X Asset Turnover=Sales/AverageTotal Asset = Return on Asset=NI/Average Total Asset X Financial Leverage=Average Total Asset/SE = Return on Equity=NI/SE If ROE>ROA, employees successful leverage IF ROA>Cost of Debt, employees successful leverage
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Unformatted text preview: Cash flow Margin=Cash from operating activities/net sales EX: NI=100, sales=2500.Tot Asset=1000, Liab=600, OE=400 NPM(NI/Sales)*Asset Turnover(Sales/Total Asset)=ROA(NI/Tot Asset)=10%*Fin Lev(Tot Asset/OE)=ROE(NI/SE)=25%, ROE>ROA, Good!...
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This note was uploaded on 02/27/2012 for the course BUSI 407 taught by Professor Bowen during the Spring '11 term at UNC.

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