Profitability Equations- Always a % Flashcards
1
Q
Gross profit margin=
The percentage of revenue left as gross profit after subtracting cost of goods sold
A
(Gross profit / revenue) x 100 %
2
Q
Mark up=
How much a business increases the cost of its products for its selling price.
A
(Gross profit / cost of sales) x 100 %
3
Q
Return on Capital Employed=
Capital employed is the amount of capital investment a business used to start operating
A
(Profit / capital employed) x 100 %
4
Q
Return on Investment=
A
(Net profit / investment) x 100 %
