Select the Incorrect Statement Regarding Net Margin

question 69

Multiple Choice

Select the incorrect statement regarding net margin.

• A)Net margin refers to the average amount of each sales dollar remaining after all expenses are subtracted.
• B)Net margin may be calculated in several ways.
• C)The smaller the net margin the better.
• D)The amount of net margin is affected by a company's choices of accounting principles.

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Definitions:

Total Taxes

The cumulative amount of taxes levied by a government on an individual, corporation, or other entity in a specified period, including income, sales, and property taxes.

Marginal Tax Rates

The rate at which your income above a certain threshold is taxed, showing the tax imposed on the incremental dollar of income.

Deductions

Amounts subtracted from gross income to determine taxable income, potentially reducing the amount of tax owed.

Marginal Tax Rate

The tax rate applied to the next dollar of taxable income, indicating the percentage of tax paid on any additional dollar earned.