Calculate the company\'s net profit margin on sales ratio for the last two repor

Question

Calculate the company's net profit margin on sales ratio for the last two reporting periods using the following formula: Net income /Total net sales. Round to three decimal places, for example, .00127321-0.12796. Then select the correct answer below. o a. The percentage of total net sales that became net income increased over the last two reporting periods O b. The percentage of total net sales that became net income decreased over the last two reporting periods c. The percentage of total net sales that became net income stayed constant over the last two reporting periods.

Explanation / Answer

Answer : a. The percentage of total net sales that became net income increased over the last two reporting periods.

=>Net profit margin on sales ratio = Net profit / Net sales

for year 2016 = 2371/135987 =1.74%

for year 2015 = 596 / 107006 = 0.56%

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