A Firm's Net Profit Margin When Ignoring the Effects of Financing

question 64

Multiple Choice

A firm's net profit margin when ignoring the effects of financing is 20 percent with an EBIT of $1.5 million and sales of $5 million.How much did the firm pay in taxes?

• A)$50,000
• B)$300,000
• C)$350,000
• D)$500,000 net profit margin =

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Definitions:

Enterprising Nonprofits

Nonprofit organizations that adopt business methods and practices to generate revenue for their social, environmental, or cultural missions.

Venture Philanthropy

An approach to charitable giving that applies the principles of venture capital financing to philanthropic projects, focusing on accountability, performance measurement, and long-term engagement.

Earned-Income Activities

Activities performed by non-profit organizations or businesses that generate revenue through the sale of goods and services rather than through donations.

Social Entrepreneurs

Individuals who establish enterprises with the goal of solving social problems or effecting social change, using business principles for public good.