Find the net profit margin earnings before interest and taxes is $20,000,net income is $10,000,sales are $50,000,and total assets are $100,000.

Question

Quizplus · Accepted Answer

Net profit margin is equal to net income divided by sales, expressed as a percentage. 
Net profit margin = (Net income / Sales) x 100
= (10,000 / 50,000) x 100
= 20%
Therefore, option B is the correct answer. Option A is not correct as it would be the gross profit margin, which does not consider operating expenses like taxes and interest. Option C is not correct as it is the return on assets, which does not consider profitability. Option D is not correct as there is a correct answer.

Find the Net Profit Margin Earnings Before Interest and Taxes