Profit margin is calculated by dividing Group of answer choices sales by cost of goods sold. gross profit by net sales. net income by stockholders' equity. net income by net sales. Flag question: Question 19

net income by net sales.

Explanation:

Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services. Thus, it refers to the amount of money a customer or consumer buying goods and services are willing to pay for the goods and services being offered. Also, the price of goods and services are primarily being set by the seller or service provider and it eventually determines the profit margin of a business firm.

In Financial accounting, profit margin can be defined as a measure of the profitability of a business over a specific period of time. Thus, it is simply the amount of money by which revenue generated through sales exceed the costs of a product.

Hence, profit margin is calculated by dividing net income by net sales or net profits by net sales over a specific period of time.