In 2019, Purple Eggplant incurred cost of goods sold of $59,823 million on net sales of $76,643 million. What was Purple Eggplant's return on sales ratio for 2019? (Assume no other expenses.)

Question

Quizplus · Accepted Answer

Net income = Net sales - Cost of goods sold
X = $76,643 - $59,823
X = $16,820 = Net income
Profit margin = Return on sales ratio
Return on sales ratio = Net income / Net sales
X = $16,820 / $76,643
X = 0.219 = 21.9%

In 2019, Purple Eggplant Incurred Cost of Goods Sold of $59,823