The ratio of income from operations to sales, which is also a factor in the DuPont formula for determining the return on investment, is called
A) profit margin
B) indirect expenses
C) investment turnover
D) cost

Question

Quizplus · Accepted Answer

The ratio of income from operations to sales is commonly referred to as the profit margin, which is used to determine the profitability of an organization in terms of its operating income. It is one of the components of the DuPont formula used to calculate the return on investment. The other options, indirect expenses, investment turnover, and cost, do not directly encompass this ratio.

The Ratio of Income from Operations to Sales, Which Is