General ournal General Ledger Requirement Trial Balance Anal

General ournal General Ledger Requirement Trial Balance Analysis er to the revenues and expenses shown on the unadjusted trial balance. Based on his information, calculate preliminary net income. (Round your Net Profit Margin answer to 1 decimal place.) Preliminary Net Income Net Profit Margin Determine whether the net profit margin is better or worse than the 30.0 percent earned by a close competitor Better K Trial Balance

Solution

Solution :-

Preliminary net income = Service revenue + Rent revenue - Salaries & Wages expense - Utilities expense.

= 16000 + 13000 - 14000 - 2000

= $ 13000.

Net profit margin = Net income / Total revenue.

= 13000 / (16000 + 13000)

= 13000 / 29000

= 0.448 i.e., 44.8 % (approx).

Conclusion :-

Net profit margin of 44.8 % is better than the net profit margin of 30 % earned by competitor of company.

Preliminary net income	$ 13000.
Net profit margin	44.8 % (approx).