If operating income for a division is $6,000, invested assets are $25,000, and sales are $30,000, the profit margin calculated would be 24%.

Name: If operating income for a division is $6,000, invested assets are $25,000, and sales are $30,000, the profit margin calculated would be 24%.
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Question

Quizplus · Accepted Answer

The profit margin is calculated by dividing the operating income by sales, not invested assets. Therefore, the correct profit margin calculation would be $6,000 divided by $30,000, which equals 20%.

If Operating Income for a Division Is $6,000, Invested Assets