Answer:
The profit margin is 12.4%
Explanation:
Profit margin is used to measure the amount of profit. It is the amount by which the money gotten from sells exceed the cost in a business. It is the ratio of net income to net sales
Net sales = Sales revenue - (sales discounts + sales returns and allowances )
Net sales = $312000 - ($4000 + $2000) = $312000 - $6000 = $306000
Net income = Net sales - cost of goods sold - operating expenses
Net income = $306000 - $184000 - $84000 = $38000
Profit margin = Net income / net sales
Profit margin = $38000/$306000 = 0.124 = 12.4%.
Answer:
The profit margin is 12.42%
Explanation:
Profit margin is the ratio of net profit to net sales. Net profit is the difference between the gross profit and the operating expenses. The gross profit is the difference between the net sales and cost of sales.
Net sales is the total sales less the sales return, discount and allowances.
As such, Net profit is the difference between the sales and all expenses.
Net profit = $312,000 - $2,000 - $4,000 - $184,000 - $84,000
= $38,000
Net sales = $312,000 - $2,000 - $4,000
= $306,000
Profit margin = $38,000/$306,000
= 12.42%
