Multiple choice general knowledge

Net Profit Margin

  1. Net Income / Sales

  2. Computes the proportion of total revenues that are available for distribution to the shareholders

  3. When this ratio is negative, as a result of a net loss, it is frequently not reported

  4. All of the Above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Net Profit Margin is calculated as Net Income divided by Sales, shows what proportion of revenue is available to shareholders as profit, and is indeed frequently not reported when negative due to net losses. All three statements are factually correct, making 'All of the Above' the right answer. This ratio is a fundamental measure of profitability and operational efficiency.

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