Which of the following would most likely cause a rise in net profit margin?
A)Increased sales
B)Decreased preferred dividends
C)Increased cost of sales
D)Decreased operating expenses
E)Decreased earnings per share

Question

Quizplus · Accepted Answer

A decrease in operating expenses would lead to a decrease in total expenses, which would increase the net profit margin. Increased sales would increase revenue, but if there is no change in expenses, the net profit margin would remain the same or potentially decrease. Decreased preferred dividends and decreased earnings per share are not necessarily indicative of a change in net profit margin. Increased cost of sales would increase expenses and decrease the net profit margin.

Which of the Following Would Most Likely Cause a Rise