a-company-has-a-profit-margin-of-3-what-does-this-suggest-about-its-net-income-r

Question

A company has a profit margin of 3%. What does this suggest about its net income relative to its sales revenue?

Accepted Answer

The company retains $0.03 of net income for every dollar of sales.

Answer

The company retains $0.03 of net sales for every dollar of net income.

Answer

The company retains $3.00 of net income for every dollar of sales.

Answer

The company retains $0.30 of net income for every dollar of sales.