A company's net profit margin is calculated as: Group of answer choices Gross profit divided by revenue. Net income divided by total assets. Operating income divided by revenue. Net income divided by revenue.
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Gross profit is calculated as net sales minus:Multiple Choicenonoperating expenses and income tax expense.operating expenses.cost of goods sold.All of the other answer choices are subtracted from net sales to calculate gross profit.
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Calculate Profitability • Gross profit margin: Gross profit x 100 /Total sales = x % • Operating margin (EBIT or Profit before Interest and Tax): Operating profit x 100 /Total sales = x % • EBITDA (Earnings or Profit before interest tax and depreciation and amortisation) margin: EBITDA x 100 /Total sales = x % • Net profit margin: Net profit after tax x 100 /Total sales = x % • Return on Assets: Net profit after tax x 100 /Total assets = x % • Return on Equity: Net profit after tax x 100 /Total equity = x %
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The gross profit ratio measures:Multiple ChoiceThe ratio of net income to net sales.How many times during the year a company sells its average inventory balance.The amount by which the sale of inventory exceeds its cost per dollar of sales.How quickly the company receives inventory from its suppliers.
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