rachel1153 rachel1153

21-12-2022
Business

Answered

Varahmihir Ltd recorded the following information for the year 2021-22:
Earnings before interest and tax (EBIT) $400,000
Net sales $7,600,000
Net assets $5,500,000
Gross assets $6,000,000
Equity share capital (shares of $10 each) 4,000,000
Required: Explain the following ratios using the DuPont analysis:
A) 1) Operating efficiency, 2) Asset use efficiency, 3) Financial leverage under DuPont
analysis and
B) Discuss the above ratios from the viewpoint of a potential investor. (2 Marks)

Answer :

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