product line or company. The
adjusted
gross
margin
includes the cost of carrying inventory,
whereas the (unadjusted) gross
margin
calculation does not take this into consideration.
Net Profit Margin (%)
Net profit margin
is the percentage of revenue left after all expenses have been deducted
from sales. The measurement reveals the amount of
profit
that a business can extract from
its total sales. The
net
sales part of the equation is gross sales minus all sales deductions,
such as sales allowances.
Adjusted Net Profit Margin (%)
Adjusted net income
or
adjusted earnings
, represents the best estimate of what that
true
profit
is.
Adjusted net profit margin
, then, is the "true"
margin
when you figure the
company's
adjusted profit
as a percentage of revenue.
Return on Assets Excluding Revaluations/
Return on Assets Including Revaluations
Return
on total
assets
(ROTA) is a ratio that measures a company's earnings before interest
and taxes (EBIT) relative to its total net
assets
. ... The ratio is considered to be an indicator of
how effectively a company is using its
assets
to generate earnings.
Return on Long Term Funds (%)
Estimated
long

term return
is a metric that provides investors with a
return
estimate they
can expect when investing in a
fund
over a
long

term
timeframe.
Overall, estimated
long

term return
disclosure can be a marketing measure easily quoted by
fixed income
funds
that can increase marketability.
3.
Liquidity And Solvency Ratios
Liquidity And Solvency Ratios
Current Ratio
0.41
0.35
0.47
Quick Ratio
0.25
0.21
0.31
Debt Equity Ratio
0.31
0.35
0.38
Long Term Debt Equity
Ratio
0.26
0.27
0.32
Liquidity ratios
measure a company's ability to convert its assets into cash. ... The
solvency
ratio
includes financial obligations in both the long and short term, whereas
liquidity
ratios
focus more on a company's shortterm debt obligations and current assets.
Current ratio
The current ratio is a popular financial ratio used to test a company's liquidity (also referred
to as its current or working capital position) by deriving the proportion of current assets
available to cover current liabilities. The concept behind this ratio is to ascertain whether a
company's shortterm assets (cash, cash equivalents, marketable securities, receivables and
inventory) are readily available to pay off its shortterm liabilities (notes payable, current
portion of term debt, payables, accrued expenses and taxes). In theory, the higher the
current ratio, the better.
Current ratio = current Assets/current liabilities
Quick Ratio
The quick ratio is a liquidity indicator that further refines the current ratio by measuring the
amount of the most liquid current assets there are to cover current liabilities. The quick ratio
is more conservative than the current ratio because it excludes inventory and other current
assets, which are more difficult to turn into cash. Therefore, a higher ratio means a more
liquid current position.
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 Fall '19
 Generally Accepted Accounting Principles, key financial ratios, Reliance Industries Ltd