Puffy's Pastries generates ﬁve cents of net income for every $1 in sales. Thus, Puffy's has a _____ of 5 %.
A) return on assets
B) return on equity
C) proﬁt margin
D) Du Pont measure
E) total asset turnover

Question

Quizplus · Accepted Answer

The given information is related to the profitability of Puffy’s Pastries, which can be measured by the profit margin. Profit margin is the ratio of net income to sales and gives an idea of how much profit a company generates for every dollar of sales. Therefore, the best choice is option C - profit margin.

Puffy's Pastries Generates ﬁVe Cents of Net Income for Every