A company's assets consist of $123,456 of cash, $237,543 of accounts receivable, $348,876 of inventory, and $1,456,987 of plant and equipment. Its liabilities consist of $187,694 of accounts payable, $56,895 of accruals, and $622,156 of long-term debt. The company's annual sales are $3,678,775, its earnings before interest and taxes are $551,816, its earnings before taxes are $489,601, and its net income is $293,760. What is the company's profit margin?
A company's assets consist of $123,456 of cash, $237,543 of accounts receivable, $348,876 of inventory, and $1,456,987 of plant and equipment. Its liabilities consist of $187,694 of accounts payable, $56,895 of accruals, and $622,156 of long-term debt. The company's annual sales are $3,678,775, its earnings before interest and taxes are $551,816, its earnings before taxes are $489,601, and its net income is $293,760. What is the company's profit margin?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:A company's assets consist of $123,456 of cash, $237,543 of accounts receivable,
$348,876 of inventory, and $1,456,987 of plant and equipment. Its liabilities consist
of $187,694 of accounts payable, $56,895 of accruals, and $622,156 of long-term
debt.
The company's annual sales are $3,678,775, its earnings before interest and taxes
are $551,816, its earnings before taxes are $489,601, and its net income is
$293,760. What is the company's profit margin?
1) 7.5%
2) 8.0%
3) 6.6%
4) 9.1%
5) 5.8%
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