net profit
Gross Profit Margin = Gross Profit/Revenues Net Profit Margin = Net Profit/Revenues
It is impossible for net profit to be greater than gross profit. Gross profit is the income made before any expenses. Net profit is less once all expenses have been deducted.
Net Income = Sales - Gross profit Gross Profit - Cost of Production = Net Income
Gross means 'before', net means 'after'. Gross profit = sales - cost of sales Net profit = sales - cost of sales - overheads (e.g. telephone, electricity) So gross profit is before deductions, whereas net profit is after all the deductions.
Net sales - CoGS = Gross Profit Gross Profit - other expenses = Net profit before tax Net profit before tax - tax amount = Net profit after tax
Gross Profit Margin = Gross Profit/Revenues Net Profit Margin = Net Profit/Revenues
Gross and Net profit are virtually the same. They both calculate EBT, earnings before taxes - all overhead and salaries.
[Gross Profit Ratio = (Gross profit / Net sales) × 100]
The Gross Profit Margin = Gross Profit/Revenue*100 regardless of weather the Gross Profit is positive or negative (a loss). Therefor, it is acceptable to have a negative Gross Profit Margin.
Net Income = Sales - Gross profit Gross Profit - Cost of Production = Net Income
It is impossible for net profit to be greater than gross profit. Gross profit is the income made before any expenses. Net profit is less once all expenses have been deducted.
Gross means 'before', net means 'after'. Gross profit = sales - cost of sales Net profit = sales - cost of sales - overheads (e.g. telephone, electricity) So gross profit is before deductions, whereas net profit is after all the deductions.
Net sales - CoGS = Gross Profit Gross Profit - other expenses = Net profit before tax Net profit before tax - tax amount = Net profit after tax
Gross Profit/Net Sales = Gross Profit Margin.
1. Net sales - cost of goods sold = Gross profit Gross profit / Net sales = Gross profit ratio
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).
gross profit