A company has computed that their "margin" is .18. Which of the following statements is the best interpretation of these results?
A) $.18 of every $1 invested in assets is net profit.
B) $.18 of every $1 made in sales is profit.
C) Every $1 invested in assets generates $.18 in sales revenue.
D) Every $1 invested in assets generates $.18 of segment margin.

Question

Quizplus · Accepted Answer

The term "margin" typically refers to profit margin or net profit divided by revenue. In this case, a margin of .18 means that for every $1 made in sales, $.18 is profit.

A Company Has Computed That Their "Margin" Is