The profit margin of the Southern division of Knucklehead Company is 12.5%.
<h3>What is meant by profit margin?</h3>
Profit margin evaluates how much of each dollar in sales or services your company retains from its earnings and is stated as a percentage. When the net income of the business is divided by the net sales or revenue, the result is the profit margin. Profit margin is calculated as profit multiplied by revenue.
There is a net profit margin as well as a larger gross profit margin (smaller). A bigger profit margin is always preferred because it indicates that the business makes more money from its sales. Profit margins indicated in percentage, however, might differ by industry. Retail businesses may have lower profit margins than growth companies, but they make up for this with bigger sales volumes.
A division's return on investment (ROI) = profit margin x investment turnover.
Given:
0.15 = profit margin x 1.20.
Profit margin = 0.15 / 1.2 = 0.125
So, 0.125 x 100 = 12.5%
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Answer:
Option (A) is the correct answer to this question.
Explanation:
The cessation of the Sporty line would forfeit the profits produced by the Sporty line business, but the business (Beautiful Watches) will have to bear the $38,000 fixed expenses involved by Spotify Watches.
However, if production continued, the Sporty watches would have suffered a loss of $32,000. The company will bear fixed costs regardless of whether the company continues or discontinues the Sporty line market.
Accordingly, the gross operating profits should have been
= Total operating expenses - ( $ 38000 - $ 32000)
= $ 55000 - ( $ 38000 - $ 32000)
= $ 55000 - $ 6000
= $ 49000
There is also a fall of $6000 ($55000-$49000) in operating profits.
Other options are incorrect because they are not related to the given scenario.
Answer:
C. Raw material inventory Dr, $ 72,000
To Direct material cost variance $27,600
To Accounts payable $44,400
Explanation:
The Journal entry is shown below:-
The variation in material costs would be favorable in a given situation. Since standard costs higher than real costs. And the journal submission would be for a desirable variance:
Raw material inventory Dr, $72,000
(12,000 × $6)
To Direct material cost variance $27,600
To Accounts payable $44,400
(Being Raw material inventory is recorded)
Answer:
Option (B) is correct.
Explanation:
Given that,
Issued preferred stock outstanding that pays dividend per year = $7.75
Current selling price = $68.19 per share
Required return = (Annual dividend ÷ Current price) × 100
= ($7.75 ÷ $68.19) × 100
= 11.37% (Approx)
Therefore, the required return is 11.37% if this issue currently sells for $68.19 per share.
Answer:
$250,000
Explanation:
Perpetuity is a type of payment that has no end. It starts on a particular date and continues endlessly.
Given:
Amount paid per year = $10,000
Annual Growth Rate = 5%
Interest Rate = 9%
Clarissa need $250,000
