General Accounting Bob's Boxes Inc. has two divisions. Division A has a profit of$165,000 on sales of $3,010,000. Division B is only able tomake $38,900 on sales of $392,000.Based on the profit margins (returns on sales), which divisionis superior?

Step 1: Define Profit MarginProfit margin is a financial ratio to evaluate the firm's profitability.…

Answered: Bob's Boxes Inc. has two divisions.…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 16E

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Bob's Boxes Inc. has two divisions. Division A has a profit of $165,000 on sales of $3,010,000. Division B is only able to make $38,900 on sales of $392,000. Based on the profit margins (returns on sales), which division is superior?