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About Profit Margin Formula
The profit margin formula is used to find the profit margin in a sale. Profit margin is elaborated as revenue generated excluding expenses divided by revenue generated. It is the ratio of net sales eliminated by the cost of goods sold, cost of the raw material, wages of workers, etc, and net sales. Profit margin is the ratio of the difference between revenue and cost with revenue multiplied by 100. The profit margin is shown as a percentage. Let us see the profit margin formula along with resolved examples.
What is Profit Margin Formula?
The profit margin formula can be given into two formulas of gross profit margin formula and the net profit margin formula which are explained below the profit margin formula. The profit margin formula can be given as:
- Profit Margin Formula = ((Revenue - Cost of Goods Sold)/Revenue)x 100
- Two main profit margins are the net profit margin and the gross profit margin. The formula for both profit margins is given below:
- Gross Profit Margin = (Grass Profit / Revenue)x 100
- Net Profit Margin = (Net Profit / Revenue)x 100
- Profit Margin Formula
- Profit Margin =((Revenue - Cost)/(Revenue))
Download a free pdf of Profit Margin Formula Its Use And Solved Examples
