The Operating Margin for the Randall Company Last Year Was

question 20

Multiple Choice

The operating margin for the Randall Company last year was 8 per cent. If total sales are £1,250,000 and average operating assets are £400,000, ROI was

• A)25%.
• B)20%.
• C)16%.
• D)10%.

---

Definitions:

Profit Margin

A financial ratio indicating the percentage of revenue that exceeds the costs of goods sold, reflecting the efficiency of a company in generating profit.

Invested Assets

Resources such as securities and properties that an individual or company has allocated funds towards with the expectation of generating income or profit.

Minimum Return

Minimum return refers to the lowest acceptable profit or benefit that an investor expects to achieve from an investment, considering the associated risks and opportunity costs.

Gross Profit

The difference between sales revenue and the cost of goods sold, before deducting overheads, taxes, interest, and other expenses.