All of the following statements regarding profit margin are true except:
A)Profit margin reflects the percent of profit in each dollar of revenue.
B)Profit margin is also called return on sales.
C)Profit margin can be used to compare a firm's performance to its competitors.
D)Profit margin is calculated by dividing net income by net sales.
E)Profit margin is not a useful measure of a company's operating results.

Question

Quizplus · Accepted Answer

This statement is not true as profit margin is a commonly used measure of a company's operating results.

All of the Following Statements Regarding Profit Margin Are True