Question

Shelton, Inc., has sales of $12 million, total assets of $9.9 million, and total debt of $7.9 million. Assume the profit margin is 6 percent. What is the company's net income? (Do not round intermediate calculations. Enter your answer in dollars not in millions, e.g., 1,234,567.)

Answer 1

$720,000

Step-by-step explanation:

The computation of the net income is shown below:

= Sales revenues × profit margin

= $12,000,000 × 6%

= $720,000

In order to find out the net income, we simply multiplied the sales revenues by the profit margin so the net income could come.

We simply considered the sales revenues and the profit margin.

All other information which is mentioned is not relevant. Hence, ignored it.