Computers, on the other hand, are likely to be written off over three to five years. Net profit is the total earnings of a company after all costs, including taxes. Most companies' tax rates stay relatively steady over time. Domestic tax rates tend to remain level unless there are changes in the rates established by the Federal, state or local governments. Foreign rates will vary depending on the countries a company does business in.
Overseas rates can change as a company does more or less business in different countries.
The Net Profit Margin shows net profits as a percent of sales. As with the operating margins, investors should look at the trend over time. An increasing trend is normally considered positive. Traditionally, it has been considered prudent for a company to have current assets that are double the size of current liabilities. That's still the case for many companies, but some larger companies, usually ones with strong balance sheets and generally predictable sales streams, operate very successfully with small or even negative amounts of working capital.