Use the information below to answer the following question(s):
Assume the Cell Phone Division of the First Electronics Corporation had the following results last year (in thousands). Management's target rate of return is 10% and the weighted average cost of capital is 7%. Its effective tax rate is 30%.

-What is the First Electronics Corporation cell phone division's profit margin?
A) 200.00%
B) 15.00%
C) 25.00%
D) 30.00%

Question

Use the information below to answer the following question(s):
Assume the Cell Phone Division of the First Electronics Corporation had the following results last year (in thousands). Management's target rate of return is 10% and the weighted average cost of capital is 7%. Its effective tax rate is 30%.
 
-What is the First Electronics Corporation cell phone division's profit margin?
A) 200.00% 
B) 15.00% 
C) 25.00% 
D) 30.00%

Quizplus · Accepted Answer

B) Operating income $900/Sales $6,000 = 15%

Use the Information Below to Answer the Following Question(s)