What Is a Difference Between the Profit Margin and the Gross

question 12

Multiple Choice

What is a difference between the profit margin and the gross profit rate?

• A)None, these are interchangeable terms.
• B)The gross profit rate is computed by dividing net sales by gross profit and the profit margin is computed by dividing net sales by net income.
• C)The gross profit rate will normally be higher than the profit margin ratio.
• D)A profit margin of 7% means that 7 cents of each net sales dollar ends up in net income and a gross profit rate of 7% means that the cost of the goods were 7% of the selling price.

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Definitions:

Role Expectations

The anticipated behaviors and actions associated with a particular social position or status.

Situational Attribution

The process of attributing someone's behavior to external factors, such as the environment or circumstances, rather than to internal personality traits.

Dispositional Attribution

The tendency to attribute people’s behaviors to their inner characteristics such as personality, beliefs, or attitudes.

Cognitive Dissonance

A psychological discomfort experienced when holding two or more conflicting beliefs, ideas, or values at the same time.