Answer:
19.05%
Explanation:
Data provided in the question:
Lumber Revenues = $120,000
Hardware Revenues = $90,000
Cost of Sales = $130,000
All other costs and expenses = $35,000
Investment Income = $8,000
Income Tax Expense = $13,000
Net Income = $40,000
Now,
The net profit margin = [( Net income) ÷ (Total revenue ) ] × 100%
or
The net profit margin = [ $40,000 ÷ ( $120,000 + $90,000 ) ] × 100%
or
The net profit margin = [ $40,000 ÷ $210,000 ] × 100%
or
The net profit margin = 0.1905 × 100%
or
The net profit margin = 19.05%
