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Net sales represents the sum of an enterprise’s gross sales deducting its returns, allowances, and discounts. The number received in the result of calculating net sales offers an accurate picture of a company’s performance. When you clearly understand the amount of net sales in comparison with gross sales, it would be easier to evaluate your company’s financial condition. In this post, you will know more about what net sales is all about and how to calculate it.
Gross profit margin is a crucial metric that analysts use in assessing the financial health of a business. It’s what remains after deducting the cost of goods sold (COGS) from product sales. The gross profit margin, also called the gross margin ratio, is calculated as a percent of total sales. It’s a comparison of the gross margin of a company to its revenue. This article explores what gross profit is. This includes how to calculate it and what a good profit margin means.
A company’s gross profit (GP) is the income obtained by taking the total sales revenue and subtracting the costs related to manufacturing and selling the products, or the costs related to providing the services. It’s found in a company’s income statement and is used in determining its gross profit margin. This post covers what gross profit is as well as how to calculate it. It also captures the difference between net profit and gross profit.