A Company Had $7,000,000 in Net Income for the Year

question 104

Multiple Choice

A company had $7,000,000 in net income for the year. Its net sales were $15,200,000 for the same period. Calculate its profit margin.

• A) 85.4%.
• B) 46.1%.
• C) 53.9%.
• D) 217.1%.
• E) 117.1%.

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Definitions:

Casting Department

A specific section within a manufacturing facility where liquid materials are poured into molds to harden and form parts or products.

FIFO Method

An inventory valuation method where the first items produced or purchased are the first ones sold, standing for "First In, First Out."

Process Costing

An accounting methodology used for homogeneous products, where costs are accumulated over a period and assigned to units of output through an averaging process.

Units Transferred

The amount of finished or semi-finished products moved from one stage of production to another, or to the final inventory.