Kragle Corporation reported the following financial data for one of its divisions for the year; average invested assets of $470,000; sales of $930,000; and income of $105,000. The investment center profit margin is:a) 22.3%b) 50.5%c) 197.9%d) 447.6%e) 11.3%

Question

Business

Conley

19 April, 01:08

Kragle Corporation reported the following financial data for one of its divisions for the year; average invested assets of $470,000; sales of $930,000; and income of $105,000. The investment center profit margin is:a) 22.3%b) 50.5%c) 197.9%d) 447.6%e) 11.3%

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Crawford · Answer 1

The correct option is E that is 11.30%

Explanation:

The formula to compute the profit margin is as:

Profit margin = Operating Income / Sales

where

Operating income is $105,000

Sales is $930,000

Putting the values in the formula:

Profit margin = $105,000 / $930,000

Profit Margin = 11.29% or 11.30%

Therefore, the investment centre profit margin will be 11.30%.