Use the following information for questions: $$\begin{array} { l r l r }
\text { Revenues } & \$ 50,000 & \text { Beginning liabilities } & \$ 245,000 \
\text { Cost of goods sold } & 35,000 & \text { Ending assets } & 450,000 \
\text { Operating expenses } & 5,500 & \text { Ending liabilities } & 255,000 \
\text { Beginning assets } & 350,000 & &
\end{array}$$
-The profit margin is closest to:
A)2%
B)19%
C)30%
D)89%

Question

Use the following information for questions: $$\begin{array} { l r l r } 
\text { Revenues } & \$ 50,000 & \text { Beginning liabilities } & \$ 245,000 \
\text { Cost of goods sold } & 35,000 & \text { Ending assets } & 450,000 \
\text { Operating expenses } & 5,500 & \text { Ending liabilities } & 255,000 \
\text { Beginning assets } & 350,000 & &
\end{array}$$
-The profit margin is closest to:
A)2%
B)19%
C)30%
D)89%

Quizplus · Accepted Answer

Profit margin is calculated as (Net Income / Revenue) * 100. Net Income is Revenue - Cost of Goods Sold - Operating Expenses, which is $50,000 - $35,000 - $5,500 = $9,500. Thus, the profit margin is ($9,500 / $50,000) * 100 = 19%.

Use the Following Information for Questions -The Profit Margin Is Closest To: A)2% B)19% C)30% D)89

Use the Following Information for Questions -The Profit Margin Is Closest To:
A)2%
B)19%
C)30%
D)89