The Du Pont Company of US pioneered a system of financial analysis which has received widespread recognition. As a useful tool for financial analysis, it has been adopted by many firms in some form or the other. The earning power, represented by return on capital employed, shows the combined effect of the net profit margin and the capital turnover. A [...]
The profitability of the firm is also measured in relation to investments. The term investment may refer to total assets, capital employed or the owners' equity. The efficiency of an enterprise is judged by the amount of profits. But sometimes the conclusion drawn on the basis of profit-to- sales ratios may be misleading. Because it is possible that profit in [...]
The below mentioned article provides a note on administration overhead. According to ICMA Terminology, Administrative overhead is defined as "the sum of those costs of general management and of secretarial accounting and administrative services, which cannot be directly related to the production, marketing, research or development functions of the enterprise." The administration cost is incurred for carrying the administrative function [...]