Fields Company presented the following data for the current year:Net sales revenue $275,000Cost of goods sold125,000Operating expenses40,000Income tax rate25%Determine the company's profit margin (rounded)ASelect one:OOa. 33%b. 31%C. 28%d. 30%

Profit margin is one of the important profitability ratios computed by the company to assess its…

Answered: Fields Company presented the following…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Common-Sized Income Statement Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages are expressed in percentages. Electronics Tannenhill Industry Company Average Sales $820,000 100 % Cost of goods sold 524,800 70 Gross profit $295,200 30 % Selling expenses $180,400 17 % Administrative expenses 65,600 7 Total operating expenses $246,000 24 % Operating income $49,200 6 % Other revenue 16,400 2 $65,600 8 % Other expense 8,200 1 Income before income tax $57,400 7 % Income tax expense 24,600 4 Net income $32,800 3 %
Horizontal analysis of the income statement Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income before income tax expense Income tax expense Net income $2,240,000 (1,925,000) $315,000 $(152,500) (118,000) $(270,500) $44,500 (17,800) $26,700 $2,000,000 (1,750,000) $250,000 $(125,000) (100,000) $(225,000) $25,000 (10,000) $15,000
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Fields Company presented the following data for the current year: Net sales revenue $275,000 Cost of goods sold 125,000 Operating expenses 40,000 Income tax rate 25% Determine the company's profit margin (rounded) 4 Select one: O O O a. 33% b. 31% C. 28% d. 30%