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Two firms, Hunters and Venus, have the following financial ratios for the past year Ratio Newman Oldie Gross profit margin 40% 42% Net profit margin
Two firms, Hunters and Venus, have the following financial ratios for the past year
Ratio | Newman | Oldie |
Gross profit margin | 40% | 42% |
Net profit margin | 15% | 21% |
Return on Investment (ROI) | 10% | 18% |
Return on Equity (ROE) | 9% | 16% |
Hunters was established two years ago and Venus Firm has been in operation since 1990.
Required:
Offer any two possible solutions to discuss the differences in the profitability ratios of these two firms.
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