A company has the following financial information: Sales $200,000 Net income 100,000 Depreciation 20,000 Interest 10,000 Taxes 5,000 What is the company's operating profit margin?

profit margin is 57.5 %

Explanation:

given data

Sales = $200000

Net income = 100000

Depreciation = 20000

Interest = 10000

Taxes = 5000

to find out

profit margin

solution

we know here profit margin is express as

profit margin = operating profit / sales ... 1

so here operating profit = Net income + Interest + Taxes

operating profit = 100000 + 10000 + 5000

operating profit = 115000

put here value in equation 1

profit margin = 115000 / 200000

profit margin = 0.575

so profit margin is 57.5 %