Net profit Net sales revenue. Net sales revenue Gross profit. Some prefer to express gross profit as a ratio.
False - Under the perpetual inventory system purchase returns or allowances are debited to the Merchandise Inventory account by the purchaser.
Usually a gross profit calculator would rephrase this equation and simply divide the total GP dollar amount we used above by the total revenues. Used to calculate the percentage of profit a company produces from its total revenue. The net profit margin is equal to net profit also known as net income divided by total revenue. Mathematically it is represented as Profit Total Sales Total Expenses.