Deal Mart
The 2014 income statement of Deal Mart shows operating revenues of $130,800, selling expenses of $37,100, general and administrative expenses of $34,900, interest expense of $900, and income tax expense of $11,430.Deal Mart's stockholders' equity was $280,000 at the beginning of the year and $320,000 at the end of the year.The company has 20,000 shares of stock outstanding at December 31, 2014.
-Read the information about Deal Mart.What is Deal Mart's profit margin to the closest tenth of a percent)?

Question

Quizplus · Accepted Answer

Profit margin = (Operating revenues - Operating expenses) / Operating revenues= ($130,800 - $37,100 - $34,900 - $900) / $130,800= $57,900 / $130,800= 0.442= 44.2% (to the closest tenth of a percent)

Deal Mart The 2014 Income Statement of Deal Mart Shows Operating Revenues