Question

Martinez Corporation reported net sales of $782,000, net income of $125,000, and total assets of $7,804,089. The profit margin is:

Answer 1

The firm's accounting profit can be calculated by subtracting the explicit costs from the total revenue.

Step-by-step explanation:

To calculate accounting profit, we subtract the explicit costs from the total revenue.

In this case, the accounting profit would be $1,000,000 - ($600,000 + $150,000 + $200,000) = $50,000.