Series 7: 9.4.1.5.4 Profit Margins

Taken from our Series 7 Top-off Online Guide

9.4.1.5.4  Profit Margins

Profit margins measure earnings as a percentage of sales; in other words, the percentage of sales that is profit. There are three kinds of profit margins that you should know:

Gross profit margin:

gross profit margin = (sales – COGS) ÷ sales

Operating profit margin:

operating profit margin = operating income ÷ sales

Net profit margin:

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