GP Ratio/RONA/Operating Profit Margin

princess

Hi guys
Please could some one tell me the link of these 3 ratios and also the formula for RONA??
I will be sooooo grateful!!
Thanks

SandyHood

Op profit margin x Asset Turnover = RONA

SandyHood

RONA = Operating Profit x 100
RONA = Net Assets

princess

Thanks for that sandy, but i am still a bit confused! Could you please explained why these could be linked? I bet you have been asked this hundreds of times so i am really sorry!!!
Thank you

SandyHood

Write out the formulae under each

When you multiplied fractions at school, did you cancel out if the bottom of one fraction was the same as the top of the other?

princess

I went to school 10 years ago!! hehe!! I cant remember what i did last week!!
I have just looked through a text book and it has got:

OP OP −sales−(crossed out)
___ = ____________ x

Fixed & net current assets −sales− (crossed out) Fixed & netcurrent assets

But...I just dont get what its telling me. I am really sorry, stressing out big time for monday.

princess

It didnt come out properly

SandyHood

operating profit x 100 x sales revenue = operating profit x 100
xxxsales revenue xxxxxxxxnet assetsxxxxxxxnet assets

SandyHood

If you cross out the two sales revenue amounts you have the RONA formula left