How is Profit Margin calculated and what does It measure?

Q: What is the profitability index? When is it used?

A: Capital investment analysis: Capital investment analysis is the process by which management plans,…

Q: Shane Wildhorse began a business, Wildhorse Company, on January 1, 2021, with an investment of…

A: Accounting equation is the one which is used for business transaction analysis. The accounting…

Q: How does the lower of cost or market relate to profit margins?

A: Answer: The lower cost or market implies that, depending on how historical costs and market costs…

Q: What formula is used to determine net profit

A: Net profit is the actual income earned by an organization after paying all the expenses. It is…

Q: How would you define profit planning? What is the importance of profit planning?

A: a) Profit planning is a progression of steps being taken to arrive at an ideal level of profit. Such…

Q: In general, what is the concept of earnings and profit designed to represent?

A: When addressing the bottom line of a company's income statement, the concept of earnings is most…

Q: What does price/earnings ratio tell you?

A: Price-to-Earnings Ratio shows relation between entity’s stock price relative to earnings made on…

Q: What is the difference between Cost-Volume Profit graph and Profit-Volume graph?

A: Introduction:- Cost-Volume Profit graph displays the relationship between the cost of units…

Q: What ratio, profit, target, or margin is the most important?

A: Accounting Accounting refers to the keeping of a systematic record of business transactions…

Q: What is the Price Earnings Ratio?

A: The price-earnings ratio is the ratio which helps the investor to determine the market value on the…

Q: Revenue: Product Service Total revenue Cost of revenue: Product Service Total cost of revenue.…

A: Gross profit margin is the ratio which is used to determine the percentage of gross profit with…

Q: What is profit contribution

A: The profit is calculated as difference between total revenue earned and total expenses incurred.

Q: What are the three components that can be described as the profit margin?

A: Income minus expenses gives us profit. The profit margin is the percentage of profits on sales or…

Q: How do cost management and financial accounting differ?

A: The accounting is a process to identify, classify and record the transactions of the business and…

Q: What is net operating margin ?

A: operating profit is the companies earnings after deducting operating expenses.  operating profit =…

Q: What variable affecting gross profit should the manager focus his attention? Why?

A: Gross Profit is the profit arrived at by deducting cost of goods sold from the turnover or the…

Q: Discuss some financial variables that affect the price-earnings ratio?

A: The price-Earning Ratio refers to the ratio between earning per share and the current market price…

Q: What is the reason that makes gross profit margin increases and decreases?

A: The gross profit margin is calculated by deducting the cost of goods sold from the sales revenue and…

Q: Examples of how cost–volume–profit analysis can be used for decision-making.

A: Solution:Cost volume profit analysis represents the impact of change in cost to operating profit. it…

Q: What is the Operating Income?

A: As per your request the solution is as per your specified requirement. Operating income is the…

Q: How does the contribution margin affect the cost-volume-profit analysis?

A: Cost Volume Profit analysis means the breakeven analysis which generally used to determine the break…

Q: What is target profit?

A: Target costing:   Target costing is a business procedure that targets the cost at the earliest…

Q: How does earnings management affect earnings quality?

A: Earnings of a company is referred as net income or bottom line item of a company. It is a very…

Q: Gross Pay: Federal Income Tax: (10% of Gross Pay) Social Security Tax (6.2% of Gross Pay) Medicare…

A: Gross pay figure is known. Statutory deduction %ages are known. An attempt had also been made to…

Q: ($ illions) Revenues $ 100 Cost of Goods Sold 60 Gross Profit 40 Operating Expense 20 Earnings…

A: Profit margin ratio is the percentage measure of the profit of the entity concerning the sales…

Q: What would the gross profit on this be?

A: Gross profit: The difference between the sales and the cost of goods sold is called gross profit.…

Q: What is the cost-volume-profit analysis and how can it be used for decisin making

A: Cost-volume-profit (CVP) analysis is a financial management tool that helps businesses understand…

Q: How is cost-volume-profit analysis different from profit planning?

A: Cost Volume Profit Analysis - This is an Analysis which provides the details How it will Effect the…

Q: What is Pro forma (or projected) profit-and-loss statement?

A: Pro Forma financial  Statement (also called as pro forma profit and loss) means that however the…

Q: what is asset? what is gross profit?

A: Financial statements: These are the financial reports prepared by an organization for a financial…

Q: What is the formula for gross profit

A: Gross profit is an excess of revenue over the cost of goods sold.it can be calculated by deducting…

Q: 2. What is cost-volume-profit analysis and what are the important assumptions of this analysis?

A: Profit analysis entails dissecting a company's reported profit figure to determine the true extent…