$\text { Harstin Corporation has provided the following data for the past year: }$

question 7

Multiple Choice

$\text { Harstin Corporation has provided the following data for the past year: }$
$\begin{array}{|l|r|}\hline \text { Sales } & \$ 625,000 \\\hline \text { Gross Margin } & \$ 70,000 \\\hline \text { Operating Income } & \$ 50,000 \\\hline \text { Shareholders' Equity } & \$ 90,000 \\\hline \text { Average Operating Assets } & \$ 250,000 \\\hline \text { Residual Income } & \$ 20,000\\\hline\end{array}$$\text { Harstin Corporation has provided the following data for the past year: }$
$\begin{array}{|l|r|}\hline \text { Sales } & \$ 625,000 \\\hline \text { Gross Margin } & \$ 70,000 \\\hline \text { Operating Income } & \$ 50,000 \\\hline \text { Shareholders' Equity } & \$ 90,000 \\\hline \text { Average Operating Assets } & \$ 250,000 \\\hline \text { Residual Income } & \$ 20,000\\\hline\end{array}$
-What was the margin for the past year?

• A) 8.0%.
• B) 11.2%.
• C) 14.4%.
• D) 19.2%.

---

Definitions:

Fixed Costs

Invariable expenditures that remain steady irrespective of the quantity of output or sales achieved, including tenancy charges, payroll, and insurance outlays.

Operating Cash Flow

The total money yielded from a company's standard business operations.

Net Income

The resulting earnings of a business after deducting all expenses and taxes from its total revenue.

Net Working Capital

Represents the difference between a company's current assets and current liabilities, highlighting its short-term financial health and ability to cover its obligations.