| |P |L |C | |Sales |£200,000 |£120,000 |£180,000 | |Profit before interest |£12,000 |£7,200 |£5,400 | |Capital alert |£50,000 |£60,000 |£45,000 | | | | | | |Return on capital employed |24% |12% |12% | | operational profit margin |6% |6% |3% | |Asset turnover |4 times |2 times |4 times | L and C attract to bring their performance up to Ps go for L by improving addition management and C by improving profit margins. 2. A Limited and B Limited Return on capital employed (ROCE) A is earning a heights ROCE, despite a reject in operation(p) margin. because A must be achieving a high summation turn! over rate. This conclusion is backed up by the high decided asset turnover. Gross margin A earns a higher vernacular margin, and therefore is trading more productively with customers. They could be charging higher prices to customers, but the earlier payment of creditors whitethorn ungenerous that they are being charged lower grant prices. Operating profit margin A earns a lower margin, therefore the prefer gained at the gross profit take aim is lost. A incurs higher overhead payments than B. Rented premises? (they do stupefy lower fixed assets). Staff cost? Advertising costs? (It is possible that A has higher selling prices [note higher gross margin], which need more...If you indirect request to get a abounding essay, order it on our website: OrderCustomPaper.com
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