The 2017 income statement of Nasir Inc.shows operating revenues of $135,800,selling expenses of $40,310,general and administrative expenses of $33,990,interest expense of $880,and income tax expense of $13,090.Nasir's stockholders' equity was $250,000 at the beginning of the year and $345,000 at the end of the year.The company has 10,000 shares of stock outstanding at December 31,2017.

Required
Compute Nasir's profit margin.What other information would you need in order to comment on whether this ratio is favorable?

Question

The 2017 income statement of Nasir Inc.shows operating revenues of $135,800,selling expenses of $40,310,general and administrative expenses of $33,990,interest expense of $880,and income tax expense of $13,090.Nasir's stockholders' equity was $250,000 at the beginning of the year and $345,000 at the end of the year.The company has 10,000 shares of stock outstanding at December 31,2017.
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Required
Compute Nasir's profit margin.What other information would you need in order to comment on whether this ratio is favorable?

Quizplus · Accepted Answer

The Answer of The 2017 income statement of Nasir Inc.shows operating revenues of $135,800,selling expenses of $40,310,general and administrative expenses of $33,990,interest expense of $880,and income tax expense of $13,090.Nasir's stockholders' equity was $250,000 at the beginning of the year and $345,000 at the end of the year.The company has 10,000 shares of stock outstanding at December 31,2017.
​
Required
Compute Nasir's profit margin.What other information would you need in order to comment on whether this ratio is favorable?

The 2017 Income Statement of Nasir Inc