COST ACCOUNTING
FLEXIBLE BUDGETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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IN 2017, ABC Company’s net income was P 200, 000, and in 2018, it was P 50, 000. What percentage increase in net income must ABC achieve in 2019 to offset the 2018 decline in net income?
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60%
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300%
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400%
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600%
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Explanation:
Detailed explanation-1: -The net profit margin calculation is simple. Take your net income and divide it by sales (or revenue, sometimes called the top line). For example if your sales are $1 million and your net income is $100, 000, your net profit margin is 10%.
Detailed explanation-2: -Net profit = Total Revenue-Total Expenses Total expenses represents all expenses-cost of goods sold, operating expenses, income taxes, interest expenses on loans and debt, depreciation of fixed assets, and SG&A (selling, general, and administrative expenses).
Detailed explanation-3: -Net profit is gross profit minus operating expenses and taxes. You can also think of it as total income minus all expenses.
There is 1 question to complete.