Definition: Gross Profit Ratio is the ratio of gross profit to net turnover expressed as a percentage. It is also known as "Gross profit as a percentage of net turnover" or "Gross profit percentage/margin".
Formula:
GP Ratio = (Gross profit / Net sales) * 100%
Example 1:
Kent Ltd has a total sales of $700,000, Sales returns $30,000, and Cost of goods sold $500,000. Calculate GP ratio.
Solution
Subscribe to:
Post Comments (Atom)
Popular Posts
Powered by Blogger.
No comments:
Post a Comment