Business calculations Flashcards
1
Q
Gross profit formula
A
Gross profit = sales revenue − cost of sales
2
Q
Net profit formula
A
Net profit = gross profit − other operating expenses and interest
3
Q
Gross profit margin formula
A
gross profit margin= gross profit/ sales revenue x 100
4
Q
Net profit margin formula
A
net profit margin= net profit/ sales revenue x 100
5
Q
Average rate of return
A
ARR= average annual profit (total profit/ number of years)
cost of investment
x 100
