Testbank Multiple Choice Question 66

The following data are provided:

	December 31
	2021		2020
Cash	$ 1700000		$ 1010000
Accounts receivable (net)	1750000		1250000
Inventories	2800000		2300000
Plant assets (net)	7500000		6600000
Accounts payable	1100000		820000
Income taxes payable	215000		110000
Bonds payable	1400000		1400000
10% Preferred stock, $50 par	1900000		1900000
Common stock, $10 par	2350000		1850000
Paid-in capital in excess of par	1700000		1400000
Retained earnings	3950000		3550000
Net credit sales	13000000
Cost of goods sold	8300000
Operating expenses	2700000
Net income	1400000

Additional information: Depreciation included in cost of goods sold and operating expenses is $1225000. On May 1, 2021, 50000 shares of common stock were issued. The preferred stock is cumulative. The preferred dividends were not declared during 2021. The profit margin on sales for 2021 is