Accelerated Logistics provides the following information: $$\begin{array} { | l | r | }
\hline \text { Operating income } & \$ 1,500,000 \
\hline \text { Net sales } & \$ 14,000,000 \
\hline \text { Average total assets } & \$ 2,000,000 \
\hline \text { Management's target rate of return } & 30 \% \
\hline
\end{array}$$ What is the company's profit margin ratio? (Round your answer to two decimal places.)
A) 14.29%
B) 10.71%
C) 75.00%
D) 27.90%

Question

Accelerated Logistics provides the following information: $$\begin{array} { | l | r | } 
\hline \text { Operating income } & \$ 1,500,000 \
\hline \text { Net sales } & \$ 14,000,000 \
\hline \text { Average total assets } & \$ 2,000,000 \
\hline \text { Management's target rate of return } & 30 \% \
\hline
\end{array}$$ What is the company's profit margin ratio? (Round your answer to two decimal places.)
A) 14.29%
B) 10.71%
C) 75.00%
D) 27.90%

Quizplus · Accepted Answer

The profit margin ratio is calculated as (Operating Income / Net Sales) * 100. So, (1,500,000 / 14,000,000) * 100 = 10.71%.

Accelerated Logistics Provides the Following Information What Is the Company's Profit Margin Ratio? (Round Your Answer