DU PONT ANALYSIS IN THE PRODUCTION AND PRESERVATION OF MEAT

Eleonora Ionela Focsan, Vasile Cristian Ioachim Miron and Ioana Jeler (popa)
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Eleonora Ionela Focsan: Universitatea „1 Decembrie 1918” Alba Iulia, Romania
Vasile Cristian Ioachim Miron: Universitatea „1 Decembrie 1918” Alba Iulia, Romania
Ioana Jeler (popa): Universitatea „1 Decembrie 1918” Alba Iulia, Romania

Annals - Economy Series, 2015, vol. 1II, 140-146

Abstract: Du Pont analysis is a type of performance investigation of an entity, which identifies the strengths and weaknesses of performance and internal factors that influence its increase or decrease. In a Du Pont analysis the following rates are involved: economic rate of return, rate of return on equity and return on sales rate. This article attempts to correlate these rates with the profit, to identify risks that threaten the company. At the same time, it tries to develop a new method of correlation which involves all three rates. This method was applied to one of the largest companies in the meat industry in Romania, to see if this analysis is feasible. Analysis result does not fully meet expectations, leading to the proposal of another way to link all the variables. The proposal involves all three rates of the previous analysis, which were taken two by two. Another method of calculation is the determinant of the matrix which involves all the rates. In the end, the results of these new methods will be rigorously analyzed.

Keywords: Du Pont analysis; ROA; ROE; ROS (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:cbu:jrnlec:y:2015:v:1ii:p:140-146

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