Question

Chace products is a division of a major corp Last year the division had total sales of 21,300,000, NOI of575,100, and avg operating assets of ______. The division's margin is closest to:

1) 2.7
2) 26.2
3) 11.5
4) 23.5

Answer 1

The division's margin is found by dividing the Net Operating Income (NOI) by the total sales and multiplying by 100, which results in approximately 2.7%, corresponding to option (1).

Step-by-step explanation:

The question is asking to calculate the division's margin, which is determined by the Net Operating Income (NOI) divided by total sales. The margin represents how much profit a company makes on its sales, a key performance indicator in financial analysis.

Given:
Total Sales: $21,300,000
NOI: $575,100
The formula to calculate margin is:

Margin = (NOI / Total Sales) × 100

Calculating the margin:

Margin = ($575,100 / $21,300,000) × 100

Margin ≈ 2.7%

Therefore, the division's margin is closest to 2.7, which corresponds to option (1).

To find the division's margin, we need to divide the net operating income (NOI) by the total sales. The formula for margin is: Margin = NOI / Total Sales. In this case, the NOI is $575,100 and the total sales are $21,300,000. So, the margin is 0.027 or 2.7%. Therefore, the closest option is 1) 2.7.