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Net operating margin |
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Definition of Net operating marginNet operating marginThe ratio of net operating income to net sales.
Related Terms:After-tax profit marginThe ratio of net income to net sales. Annual fund operating expensesFor investment companies, the management fee and "other expenses," approximated net realizable value at split-off allocationa method of allocating joint cost to joint products using a Before-tax profit marginThe ratio of net income before taxes to net sales. Buy on marginA transaction in which an investor borrows to buy additional shares, using the shares cash flow from operating activities, or cash flow from profitThis equals the cash inflow from sales during the period minus the cash Cash Flow Provided by Operating ActivitiesWith some exceptions, the cash effects of transactions Contribution marginThe difference between variable revenue and variable cost. contribution marginAn intermediate measure of profit equal to sales revenue contribution marginthe difference between selling price and Contribution marginThe margin that results when variable production costs are subtracted contribution margin ratiothe proportion of each revenue dollar remaining after variable costs have been covered; degree of operating leveragea factor that indicates how a percentage change in sales, from the existing or current degree of operating leverage (DOL)Percentage change in profits given a 1 percent change in sales. Dollar safety marginThe dollar equivalent of the safety cushion for a portfolio in a contingent immunization EBITDA MarginEBITDA divided by total sales or total revenue. Effective margin (EM)Used with SAT performance measures, the amount equaling the net earned spread, or European Monetary System (EMS)An exchange arrangement formed in 1979 that involves the currencies Exposure nettingOffsetting exposures in one currency with exposures in the same or another currency, Firm's net value of debtTotal firm value minus total firm debt. Gross marginRevenues less the cost of goods sold. gross margin, or gross profitThis first-line measure of profit Gross profit marginGross profit divided by sales, which is equal to each sales dollar left over after paying Gross Profit MarginGross profit divided by revenue. Initial margin requirementWhen buying securities on margin, the proportion of the total market value of International Monetary FundAn organization founded in 1944 to oversee exchange arrangements of International Monetary Fund (IMF)Organization originally established to manage the postwar fixed exchange rate system. International Monetary Market (IMM)A division of the CME established in 1972 for trading financial Internet business modela model that involves intraneta mechanism for sharing information and delivering data from corporate databases to the local-area network (LAN) desktops Maintenance margin requirementA sum, usually smaller than -but part of the original margin, which must MarginThis allows investors to buy securities by borrowing money from a broker. The margin is the MarginThe amount added to a lower figure to reach a higher figure, expressed as a percentage of the higher figure, e.g. the margin that profit represents as a percentage of selling price. Margin account (Stocks)A leverageable account in which stocks can be purchased for a combination of Margin callA demand for additional funds because of adverse price movement. Maintenance margin Margin of safetyA measure of the difference between the anticipated and breakeven levels of activity. margin of safetythe excess of the budgeted or actual sales Margin requirement (Options)The amount of cash an uncovered (naked) option writer is required to Margin Tax RateThe tax rate applicable to the last unit of income. MarginalIncremental. Marginal costThe cost of producing one extra unit. Marginal costThe incremental change in the unit cost of a product as a result of a Marginal Propensity to ConsumeFraction of an increase in disposable income that is spent on consumption. Marginal Propensity to ImportFraction of an increase in disposable income that is spent on imports. Marginal Propensity to SaveFraction of an increase in disposable income that is saved. Marginal tax rateThe tax rate that would have to be paid on any additional dollars of taxable income earned. marginal tax rateAdditional taxes owed per dollar of additional income. Marginal Tax RatePercent of an increase in income paid in tax. MonetarismSchool of economic thought stressing the importance of the money supply in the economy. Adherents believe that the economy is inherently stable, so that policy is best undertaken through adoption of a policy rule. Monetarist RuleProposal that the money supply be increased at a steady rate equal approximately to the real rate of growth of the economy. Contrast with discretionary policy. Monetary AggregateAny measure of the economy's money supply. Monetary BaseSee money base. Monetary goldGold held by governmental authorities as a financial asset. Monetary / non-monetary methodUnder this translation method, monetary items (e.g. cash, accounts Monetary policyActions taken by the Board of Governors of the Federal Reserve System to influence the Monetary PolicyActions taken by the central bank to change the supply of money and the interest rate and thereby affect economic activity. Monetizing the DebtSee printing money. Net adjusted present valueThe adjusted present value minus the initial cost of an investment. Net advantage of refundingThe net present value of the savings from a refunding. Net advantage to leasingThe net present value of entering into a lease financing arrangement rather than Net advantage to mergingThe difference in total post- and pre-merger market value minus the cost of the merger. net asset valueThe value of all the holdings of a mutual fund, less the fund's liabilities. Net asset value (NAV)The value of a fund's investments. For a mutual fund, the net asset value per share Net assetsThe difference between total assets on the one hand and current liabilities and noncapitalized longterm Net benefit to leverage factorA linear approximation of a factor, T*, that enables one to operationalize the Net book valueThe current book value of an asset or liability; that is, its original book value net of any Net Cash after OperationsCash flow available for debt service—the payment of interest and principal on loans. Generally calculated as cash provided by operating activities before interest Net cash balanceBeginning cash balance plus cash receipts minus cash disbursements. Net changeThis is the difference between a day's last trade and the previous day's last trade. net cost of normal spoilagethe cost of spoiled work less the estimated disposal value of that work Net Domestic ProductGDP minus depreciation. Net errors and omissionsIn balance of payments accounting, net errors and omissions record the statistical Net ExportsExports minus imports. Net financing costAlso called the cost of carry or, simply, carry, the difference between the cost of financing Net floatSum of disbursement float and collection float. net floatDifference between payment float and availability float. Net incomeThe company's total earnings, reflecting revenues adjusted for costs of doing business, NET INCOMEThe profit a company makes after cost of goods sold, expenses, and taxes are subtracted from net sales. Net incomeThe last line of the Income Statement; it represents the amount that the company earned during a specified period. Net incomeThe excess of revenues over expenses, including the impact of income taxes. net income (also called the bottom line, earnings, net earnings, and netoperating earnings) Net inventoryThe current inventory balance, less allocated or reserved items. Net investmentGross, or total, investment minus depreciation. Net InvestmentInvestment spending minus depreciation. Net leaseA lease arrangement under which the lessee is responsible for all property taxes, maintenance Net National ProductGNP minus depreciation. Net operating lossesLosses that a firm can take advantage of to reduce taxes. Net PayThe amount of an employee’s wages payable after all tax and other deductions have been removed. Net periodThe period of time between the end of the discount period and the date payment is due. Net present valueA discounted cash flow methodology that uses a required rate of net present value methoda process that uses the discounted Net present value (NPV)The present value of the expected future cash flows minus the cost. Net present value (NPV)A discounted cash flow technique used for investment appraisal that calculates the present value of future cash flows and deducts the initial capital investment. net present value (NPV)Equals the present value (PV) of a capital investment Net Present Value (NPV)The present value of all future cash inflows minus the present value net present value (NPV)the difference between the present values of all cash inflows and outflows for an investment project net present value (NPV)Present value of cash flows minus initial investment. Net Present Value (NPV) MethodA method of ranking investment proposals. NPV is equal to the present value of the future returns, discounted at the marginal cost of capital, minus the present value of the cost of the investment. Net present value of future investmentsThe present value of the total sum of NPVs expected to result from
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