Question

Chester has a ROS of 0.08 (ROS = Net income/Sales). That means: Select: 1 There are...

Chester has a ROS of 0.08 (ROS = Net income/Sales). That means: Select: 1

There are sales of $8 for every dollar of profit.

There is a 8% profit on each dollar of sales.

There are sales of $92 for every dollar of profit.

For every $8 of sales there is a profit of 1%.

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Answer #1

ROS means net profit upon sales. This also indicates the ratio between profit and revenue. When we see a value of 0.08 it means that the profit is $8 for every $100 in sales. In other words there is a 8% profit on each dollar of sales.

The correct answer: There is a 8% profit one each dollar of sales

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