What is the difference between gross margin and net profit?
Gross Margin = (Gross Profit/Sales)*100
Gross Profit = Revenue - Cost of Sales
Net Profit = Revenue - Expenses
Or in words, the Gross Margin is an expression of the Gross Profit as a percentage of Sales, where the Gross Profit is Sales minus the Cost of Sales. The Net Profit, on the other hand, is Revenue minus ALL Expenses (including cost of sales).
No comments:
Post a Comment