Question

A company has revenue of $250,000, gross profit of $175,000, and expenses of $55,000. the component percentage for net income is ____________.

Answer 1

The component percentage for net income is 48%

Step-by-step explanation:

For computing the percentage of net income, first, we have to compute the net income which is shown below:

= Gross profit - expenses incurred

= $175,000 - $55,000

= $120,000

The net income is $120,000 and the sales revenue is $250,000, so the net income component percentage would be

= (Net income ÷ Sales revenue) × 100

= ($120,000 ÷$250,000) × 100

= 48%

Hence, the component percentage for net income is 48%