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Use the Information Below to Answer the Following Questions That

Question 91

Multiple Choice

Use the information below to answer the following questions that refer to Table B-2. Based on the information in Table B-2, and assuming a 50 percent tax on net profit, the return on investment (ROI) is:
 Table B-2  Gross sales $240,000 Returns $20,000 Allowances $20,000 Gross margin 25% Beginning inventory $50,000 Ending inventory $50,000 Expenses $40,000 Markdowns $30,000 Investment $50,000\begin{array} { l c } { \text { Table B-2 } } & \\\text { Gross sales } & \$ 240,000 \\\text { Returns } & \$ 20,000 \\\text { Allowances } & \$ 20,000 \\\text { Gross margin } & 25 \% \\\text { Beginning inventory } & \$ 50,000 \\\text { Ending inventory } & \$ 50,000 \\\text { Expenses } & \$ 40,000 \\\text { Markdowns } & \$ 30,000 \\\text { Investment } & \$ 50,000\end{array}


A) 10%.
B) 20%.
C) 15%.
D) 5%.
E) the return is negative because the business lost money.

Correct Answer:

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