Compute the profit margin (rounded to nearest percent)for the Tim Tom investment center as shown below. $\begin{array}{lr}
& \text { Tim Tom Subsidiary } \
\text { Total sales } & \$ 1,600 \
\text { Operating income } & \$ 140 \
\text { Average assets invested } & \$ 900 \
\text { Profit margin } & ? \
\text { Asset turnover } & ? \
\text { ROI } & ?
\end{array}$

Question

Compute the profit margin (rounded to nearest percent)for the Tim Tom investment center as shown below. $\begin{array}{lr}
 & \text { Tim Tom Subsidiary } \
\text { Total sales } & \$ 1,600 \
\text { Operating income } & \$ 140 \
\text { Average assets invested } & \$ 900 \
\text { Profit margin } & ? \
\text { Asset turnover } & ? \
\text { ROI } & ?
\end{array}$

Quizplus · Accepted Answer

The profit margin is calculated as (Operating Income / Total Sales) * 100. So, (140 / 1600) * 100 = 8.75%, which rounds to 9%.

Compute the Profit Margin (Rounded to Nearest Percent)for the Tim