Kitsure, a cosmetics company, was able to sell 20 percent more than its estimated sales in a year. The company was able to acquire its investment along with a higher turnover for its shareholders. Which of the following financial ratios provides the measure of Kitsure's earnings?
A) Leverage ratios
B) Asset management ratios
C) Liquidity ratios
D) Profitability ratios

Question

Quizplus · Accepted Answer

Profitability ratios measure a company's ability to generate earnings relative to its revenue, assets, or equity, which is relevant to Kitsure's increased sales and shareholder returns.

Kitsure, a Cosmetics Company, Was Able to Sell 20 Percent