Which measure of profitability is probably of greatest interest to the investing public why?
The profitability ratio of greatest interest to the investing public is Return on Common Equity (ROE) because it measures the return earned on the common stockholders’ investment in the firm. Also, it shows how much profit the company was able to generate given the resources provided by its stockholders .Click to see full answer. Then,…
The profitability ratio of greatest interest to the investing public is Return on Common Equity (ROE) because it measures the return earned on the common stockholders’ investment in the firm. Also, it shows how much profit the company was able to generate given the resources provided by its stockholders .Click to see full answer. Then, which of the following would be of the greatest interest to a company’s investors?The return on equity profitability margin would be the greatest interest to the investing public because this margin measures the return earned on common stockholders’ investments in the firm. It deals directly with the return that the investors will receive if they invest in the company.Also Know, what ratio can be used to measure the firm’s degree of indebtedness? The ratio which measures the degree of indebtedness to the firm is debt ratio. The debt ratio can be defined as the ratio which measures the proportion of financing of total assets by creditors. Similarly one may ask, what are three ratios of profitability are found on a common size income statement? Three ratios of profitability found on a common-size income statement are: (1) the gross profit margin, (2) the operating profit margin, and (3) the net profit margin.What is the best measure of profitability? net margin
