Net Profits Divided by Net Sales Equals (=)

question 143

Multiple Choice

Net profits divided by net sales equals (=)

• A) financial leverage.
• B) profit margin.
• C) rate of return on net worth.
• D) return on assets.
• E) asset turnover.

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Definitions:

Income Statements

A financial statement that shows a company’s revenues, expenses, and profits or losses over a specific period.

Wholesalers

Businesses that buy goods in bulk from manufacturers or distributors and then sell them in smaller quantities to retailers or other businesses.

Retailers

Businesses that sell goods or services directly to consumers.

FOB Shipping Point

A term used in shipping indicating that the buyer assumes ownership and the risk of loss of goods once the seller ships the product.