Which of the following describes the profit margin ratio?
A)Average total assets divided by net income
B)Net income plus income tax expense divided by average total assets
C)Average total assets divided by net revenue
D)Net income divided by net revenue

Question

Quizplus · Accepted Answer

The profit margin ratio is calculated by dividing the net income by the net revenue. This ratio helps to show how much of each dollar in revenue is actually earning by the company as profit.

Which of the Following Describes the Profit Margin Ratio