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Net income divided by total revenue is referred to as:
A) The equity multiplier.
B) Earnings per share.
C) The retention ratio.
D) The operating cash flow.
E) The profit margin.
Net Income
The total profit of a company after all expenses, taxes, and costs have been deducted from total revenue, indicating the financial performance in a given period.
Total Revenue
Total Revenue is the full amount of income generated by the sale of goods or services related to a company's primary operations.
Profit Margin
A financial metric that measures the amount of net income earned with each dollar of sales generated by comparing net income and revenue.
- Uncover and compute distinct financial ratios, covering aspects of profitability, liquidity, and efficiency evaluations.
- Analyze the impact of financial decisions on the firm's performance through ratio analysis.
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Learning Objectives
- Uncover and compute distinct financial ratios, covering aspects of profitability, liquidity, and efficiency evaluations.
- Analyze the impact of financial decisions on the firm's performance through ratio analysis.
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