Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula: Profit Margin = Net income Net sales × 100 To Determine: The initial step to be taken for the further investigation.

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Chapter 5, Problem 25Q

To determine

Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income and net sales. It is calculated by using the following formula:

Profit Margin=Net incomeNet sales×100

To Determine: The initial step to be taken for the further investigation.

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