A company has:
Sales of 27million
Total assets of 19 million
Total debt of 6,400,000
Profit margin 8%

What is the net income?

There are several of ways to calculate NI depending on the information available.


Sales – Total costs
Dividends + Additional retained earnings
Sales * Profit margin
New retained earnings – Old retained earnings


In your case we will calculate the NI as follow:

Sales * Profit margin
= 27,000,000 * 0.08
= 2,160,000

Good luck :)