Gross Profit Margin

What is Revenue?

• Revenue is the income generated from the sale of goods and services.

• Revenue is the total expenses incurred by a business.

• Revenue is the profit made after all expenses are deducted.

• Revenue is the amount of money invested in a business.

If a product is sold for $20 and the cost to produce it is $15, what is the profit?

• $3

• $4

• $5

• $6

What is the formula for calculating Gross Profit Margin?

• Gross Profit Margin = (Gross Profit / Revenue) x 100.

• Gross Profit Margin = (Revenue - Cost of Goods Sold) / Revenue x 100.

• Gross Profit Margin = (Net Profit / Total Assets) x 100.

• Gross Profit Margin = (Operating Income / Total Revenue) x 100.

If a company has a Gross Profit of $200,000 and Revenue of $500,000, what is the Gross Profit Margin?

• 30%

• 35%

• 40%

• 45%

How do you calculate Gross Profit?

• Gross Profit is calculated by adding the Cost of Goods Sold (COGS) to Revenue.

• Gross Profit is calculated by subtracting the Cost of Goods Sold (COGS) from Revenue.

• Gross Profit is calculated by multiplying Revenue by the Cost of Goods Sold (COGS).

• Gross Profit is calculated by dividing Revenue by the Cost of Goods Sold (COGS).

What is the significance of Gross Profit Margin?

• It indicates how efficiently a company is producing and selling its goods.

• It measures the total revenue of a company.

• It reflects the company's market share in its industry.

• It shows the total expenses incurred by a company.

What does it mean when revenues are higher than costs?

• It means the business is making a profit.

• It means the business is incurring a loss.

• It means the business is breaking even.

• It means the business is facing bankruptcy.

If a business has a revenue of $100,000 and COGS of $60,000, what is the Gross Profit Margin?

• 30%

• 40%

• 50%

• 20%

If a business sells products worth $500,000 and has sales returns of $50,000, what is the net revenue?

• $400,000

• $450,000

• $500,000

• $550,000

What does it mean if a business has a Gross Profit Margin of 50%?

• It means that for every dollar of revenue, the business retains 50 cents after covering the cost of goods sold.

• It indicates that the business has a 50% market share in its industry.

• It shows that the business's total expenses are 50% of its revenue.

• It suggests that the business is losing money on every sale.