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Last year Electric Autos had sales of $165 million and assets at the start of the year of $280 million. If its return on start-of-year assets was 10%, what was its operating profit margin? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places)

Respuesta :

Answer: 16.9697%

Explanation:

Sales = $165 million

Assets in beginning of year = $280 million

Assets return on start of the year = 10%

[tex]Return\ on\ Net\ Assets =\frac{Operating\ Profit}{Net\ Assets}\times 100[/tex]

[tex]\frac{Return\ on\ Net\ Assets\times Net\ Assets}{100} =Operating\ Profit[/tex]

[tex]\frac{10\times 280}{100} =Operating\ Profit[/tex]

Operating Profit = 28

[tex]Operating\ Profit\ Margin = \frac{Operating\ Profit}{Sales\ revenue}[/tex]

[tex]Operating\ Profit\ Margin = \frac{28}{165}\times 100[/tex]

                                                  =  16.9697%

ayokenny2001

The operating profit margin for Electric Autos is 16.9697%

What is operating profit margin?

Operating profit refers to the income earned from the operations of a business, minus other financing or tax-related issues.

We know that Return on asset

= Operating profit / Net asset * 100

Then

Operating profit

= (Return on net asset * Net asset / 100)

= 10 * 280 / 100

= 28

Operating profit margin

= (Operating profit / Sales revenue) *  100

= (28 / 165) * 100

=  16.9697%

Learn more about operating profit margin here : https://brainly.com/question/25895372

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