The Poole Company reported the following income for Year 2: What is the company's net margin? (Rounded to the nearest whole percent.)
A)73%
B)40%
C)18%
D)27%

Question

The Poole Company reported the following income for Year 2:  What is the company's net margin? (Rounded to the nearest whole percent.)
A)73% 
B)40% 
C)18% 
D)27%

Quizplus · Accepted Answer

Net Margin = Net Income / Total Revenue
Net Income = Total Revenue - Cost of Goods Sold - Operating Expenses - Interest - Taxes
Net Income = $6,600,000 - $3,300,000 - $2,200,000 - $400,000 - $300,000 = $400,000
Net Margin = $400,000 / $2,200,000 = 0.18 or 18% (rounded to nearest whole percent)

The Poole Company Reported the Following Income for Year 2