The balance sheet of Paradise Pizza reports total assets of $1,500,000 and $1,700,000 at the beginning and end of the year,respectively.Net income and sales for the year are $240,000 and $2,000,000,respectively.What is Paradise Pizza's profit margin?
A)15%.
B)14.12%.
C)16%.
D)12%.

Question

Quizplus · Accepted Answer

Profit margin is calculated as (Net Income / Sales) * 100. For Paradise Pizza, it is ($240,000 / $2,000,000) * 100 = 12%.

The Balance Sheet of Paradise Pizza Reports Total Assets of $1,500,000