Calculation of gross and net profit to turnover. - SS2 Commerce Past Questions and Answers - page 1
Gross profit margin is calculated by dividing the ______ by the turnover and multiplying by 100.
Gross profit
Cost of goods sold (COGS)
Gross profit
Net profit margin takes into account all of the following except:
Operating expenses
Taxes
Gross profit
The formula for calculating gross profit margin is:
(Turnover / Gross Profit) X 100
(Gross Profit / Turnover) X 100
(Net Profit / Turnover) X 100
Net profit margin represents the percentage of net profit in relation to the ______.
Gross Profit
Operating expenses
Turnover
Gross profit margin indicates the proportion of each dollar of ______ that is retained as gross profit.
Net profit
Turnover
Operating expenses
Explain the difference between gross profit margin and net profit margin in relation to a business's financial performance.