SAPM Exam Notes Due Oct

1. Return on capital employed

(Profit before tax + interest cost) X 100
(Capital + non-current liabilities)

2. Gross profit percentage

(Revenue-cost of sales) X 100
Revenue

3. Net profit percentage

(Profit before tax + interest cost) X 100
Revenue

4. Quick/acid test ratio

Current assets - inventory : 1
Current liabilities

5. Receivables collection period

Receivables X 365
Revenue

6. Earnings per share

Profit after tax
No. of ordinary shares in issue

Describe return on capital employed in theory:
1) Find industry average from the question X
2) Return on capital employed
3) Compare this year VS last year
4) Outcome if below industry average