Assessing Business Performance Test
Module 8 • 10 Questions
Question 1 of 10
0 of 10 answered
A common size profit and loss account for Asian Paints shows material cost down 2.25 points, all other expenses up marginally, profit before tax up only marginally, tax expense down 2.9 points and PAT margin up 2.33 points. What is the correct reading?
A
The PAT margin improvement is driven mainly by a lower tax charge rather than by operations, since PBT margin barely moved
B
Operating efficiency improved by 2.33 points, since that is the movement in the bottom line
C
The material saving of 2.25 points is the sole cause of the PAT margin improvement
D
The statement cannot be interpreted because common size analysis applies only to the balance sheet