Altus minerals recently reported $2850 of sales $1270 of operating costs other than depreciation and $250 of depreciation Interest expense of $70 And a tax rate of 40% How much after tax operating income does the firm have?
Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
Net Operating Profit after Tax (NOPAT) refers to the operating profit of a business after deducting tax expense from it.
So, NOPAT = Earnings before interest and taxes x (1-Tax rate)
Step by step
Solved in 3 steps
