Changes in the profit margin ratio could indicate changes in any of the following except changes in:
A)sales volume.
B)product profitability.
C)the cost structure.
D)the pricing policy.

Question

Quizplus · Accepted Answer

The profit margin ratio is primarily influenced by product profitability, the cost structure, and the pricing policy. Sales volume affects total profits but does not directly change the profit margin ratio, which is calculated as net income divided by sales.

Changes in the Profit Margin Ratio Could Indicate Changes in Any