Fixed assets and working capital combined make up the major resources used by businesses to generate income. The ability of a company to use these resources efficiently directly affects profitability.

The DuPont analysis system separates the different components of business performance indicators, including ROA, into smaller parts. The dissection of performance metrics helps business owners ...

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Return on assets (ROA) is a measure of how efficiently a company uses the assets it owns to generate profits. Managers, analysts and investors use ROA to evaluate a company’s financial health. Return ...

Return-on-equity (ROE) is the correct profit metric to evaluate the performance of a business. However, the primary emphasis on financial ratio analysis must be on operating performance. The “advanced ...