GPM and NPM Check-in

What is the definition of revenue?

• Money a business uses to purchase supplies.

• The money businesses receive from customers when they buy goods or services.

• Money that is invested in a company's future.

• Money an employee receives for working for a company.

How do you calculate Gross Profit Margin?

• gross profit / sales (revenue) x 100

• gross profit x sales (revenue) / 100

• gross profit / sales (revenue) / 100

• gross profit x sales (revenue) x 100

Which is the correct formula to calculate a firm’s net profit margin?

• Net profit/sales revenue

• Sales revenue/net profit

• Net profit/sales revenue x 100

• Sales revenue/net profit x 100

How do you calculate Net Profit Margin?

• net profit / sales (revenue) x 100

• net profit x sales (revenue) / 100

• net profit / sales (revenue) / 100

• net profit x sales (revenue) x 100

Gross Profit Margin should be greater than Net Profit Margin?

• True

• False

Sensational Sweets Ltd had gross profits of £150,000 and revenue of £200,000. What was the gross profit margin?

• 55%

• 65%

• 75%

• 85%

What is the formula for Gross Profit Margin

• Profit / Net sales revenue X 100

• Gross profit / Net sales revenue X 100

• Gross profit / Sales revenue X 100

• Profit / Cost of sales X 100

The Net Profit Margin could decrease due to

• Poor expense control

• Low sales revenue

• High cost of sales

• All of the above

When is a business making a profit?

• When revenues are higher than costs
• When revenues equal costs
• When revenues are less than costs

How do you calculate Net Profit Margin?

• net profit / sales (revenue) x 100

• net profit x sales (revenue) / 100

• net profit / sales (revenue) / 100

• net profit x sales (revenue) x 100