Multiple Choice
Which of the following transactions will not decrease the net profit margin ratio?
A) Accruing interest expense at year-end.
B) The recording of depreciation expense.
C) Using cash to pay for previously accrued wages.
D) Accruing utilities expense at year-enD.Net profit margin = Net income ÷ Net sales (operating revenues) .Previously accrued expenses have already been recognized and factored into net income; paying for these expenses impacts the balance sheet and not the income statement.
Correct Answer:
Verified
Correct Answer:
Verified
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