 In this section, we are going to discuss the various relations among the different types of financial ratios, which we have discussed earlier. So in order to have an idea about the financial performance of our business or the overall operational efficiency and things like that, we use the concept of different types of financial ratios such as the return on assets, the return on equity, etc. So it is important to have an idea that what could be the possible relationship between different ratios and that would help us in order to identify the interlinkages between different types of factors that are important in order to plan from the perspective of the financials or the overall expenses. Or if you are going to assess or improve the financial performance of an entity, then obviously it is important for us to look at how one ratio is linked up with the other ratios. So firstly, the thing which I am going to discuss with you is that the return on asset is basically a product of two types of ratios. The first one is return on sales and the other one is the asset turnover ratio. So if we multiply the return on sales with the asset turnover ratio, we get the ROI or the return on assets. So if we look at the formula, the formula says that when we have to calculate the ratio, the return on sales, it is the earning before interest and taxes divided by the overall sales of a firm and this would give us the return on sales. So then we have got the asset turnover ratio, which is basically a ratio of sales to the total assets a firm has. And if we multiply these two, we will get ROA, which means the return on assets. And it does not mean that all the firms of the same size should always come up with the same number of ROA. Basically, the two can change the overall value of ROA. The two means the return on sales and the asset turnover ratio. So if suppose we have got a firm which has got a higher return on sales and a lower asset turnover ratio, it can have a certain value of return on assets and another firm can also have the same value of return on assets, even if it has a different return on sales and asset turnover ratio because the two are multiplied with each other. The latter two are multiplied with each other. So the product may be the same, but the overall composition can vary. So right over here, I would like to explain this concept or the interlinkage between ROA, ROAS and asset turnover ratio with the help of an example. Suppose we have got a supermarket chain in which the overall profit margin is a bit low. That would be low, but the asset turnover ratio can be very high. On the other hand, if we take into account the example of a jewelry shop, because the jewelry shop, the jewelry which is being sold in a jewelry shop is quite expensive and the profit margin can be higher. In this case, ROAS will be larger, but the turnover ratio will be smaller as compared to the supermarket situation. So both may have different components, different values of ROAS and asset turnover ratio, but there may be a possibility that the ROA which you have calculated for a supermarket grocery store and the ROA for the jewelry shop, they both turn out to be the same. So these are the two important things which we need to understand. So if we look at the concept of ROAS, it's basically it tells us about the overall operational efficiency of a firm. Similarly, asset turnover ratio also indicates how efficiently a firm is deploying its assets to produce revenue. So that is also a kind of a measure of operational efficiency that it tells you how nicely you are executing your things in order to fulfill your objectives.