Question

Expedia and Priceline compete as online travel agencies. Historically, Expedia has focused more on flights, whereas Priceline has focused on hotel bookings. The following amounts were reported by the two companies in 2015. (in millions) Net Income Total Assets Total Liabilities Total Revenues Expedia $ 723 $ 15,504 $ 10,574 $ 6,672 Priceline 2,551 17,421 8,625 9,224 Required: Calculate each company’s net profit margin expressed as a percent. (Round your answers to 1 decimal place.)

Answer 1

Expedia : 10.84%

Priceline :27.66%

Step-by-step explanation:

Net profit margin is an example of a profitability ratio. It measures he ability of a firm to earn a profit from its assets

Net profit margin = Net income / Revenue

Expedia : $723 / $6,672 = 0.1084 = 10.84%

Priceline : 2,551 / 9,224 = 0.2766 = 27.66%