If the operating income is $5650000 and the revenue is $68558000, then the return on sales will be ___________?
Correct answer: A. 8.24%
- A. 8.24%
- B. 7.24%
- C. 9.24%
- D. 10.24%
Explanation
Return on sales equals operating income divided by revenue: $5,650,000 ÷ $68,558,000 × 100 ≈ 8.24%. It measures the operating profit earned from each dollar of sales.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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