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Accounts Report for JT Engineering
Finance & Accounting
Pages 2 (502 words)
Gross profit margin is an analyzing tool which assists in identifying how effectively and efficiently the company is utilizing its raw materials, variable cost related to labor and fixed costs such as rent and depreciation of property plant and equipment
Net profit margin, on the other hand analyzes the profitability of the company before deducting the taxation and finance charges from the earningsThe statement of financial position tells the shareholder above the financial outlook of a company and the status of the assets and liabilities. Statement of financial position is usually divided into three parts, Assets, Liabilities and Shareholder equity. Assets are further divided into non-current assets and current assets whereas liabilities are divided in to non-current and current as well. Usually a company which has higher assets base and positive equity portrays stronger and better financial outlook. From shareholder’s perspective, the statement of financial position is very important as it guides them to take important decision pertaining to the investment in the shares of the company.Non-current assets are those which are held by entity for a longer period of time and maturity or the useful life of these assets are usually more than one year. Example of non-current assets would be Property, Plant and Equipment, Deferred acquisition cost and loans and advances given ...
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