Which of the following expressions is termed the profit margin factor as used in determining the rate of return on investment?
A) Sales / Income from operations
B) Income from operations / Sales
C) Invested assets / Sales
D) Sales / Invested assets

Question

Quizplus · Accepted Answer

The profit margin factor is calculated by dividing Income from operations by Sales. This ratio shows the percentage of sales that are converted into profits after accounting for all operating expenses. It is an important metric used to assess the profitability of a company and is a key component in calculating the rate of return on investment.

Which of the Following Expressions Is Termed the Profit Margin