delmont movers has a profit margin of 6.2 percent and net income of $48900. what is the common size percentage for the cost of goods sold if that expense amounted to $379000 for the year?

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Business

Oliver Boone

2 September, 07:32

delmont movers has a profit margin of 6.2 percent and net income of $48900. what is the common size percentage for the cost of goods sold if that expense amounted to $379000 for the year?

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Justice Solis · Answer 1

The common size percentage for the cost of goods sold is 48.05%

Explanation:

The profit margin reflects a company's overall ability to turn income into profit, is calculated by formula:

Profit margin = Net income/Net sales

Delmont movers has a profit margin of 6.2 percent and net income of $48,900

Net sales of the company = Net income/Profit margin = $48,900/6.2% = $788,709.68

The cost of goods sold amounted to $379,000.

The common size percentage for the cost of goods sold = (The cost of goods sold/Net sales) x 100% = ($379,000/$788,709.68) x 100% = 48.05%