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QuestionsCategory: Financials QuadrantGross-Profit-to-Assets Ratio – What is consider high depreciation
James Tay asked 2 years ago

GPTA ratio is best used on companies with high depreciation or high marketing expenses.  How to determine if a company has high depreciation, any percentage? Rule of thumb to follow?  Where to find the correct depreciation value – from balance sheet or income statement?

1 Answers
Victor Chng answered 2 years ago

Hi James,
 
Usually high depreciation companies have cash flow to net income of more than 2x.