2.4 theme 2 calculations Flashcards
(8 cards)
1
Q
gross profit formula
A
sales revenue — cost of sales
2
Q
gross profit margin
A
gross profit
———————- x100
sales revenue
3
Q
net profit
A
gross profit — other expenses
4
Q
net profit margin
A
net profit
——————————. x100
sales revenue
5
Q
average rate or return
A
total profit / number of years
——————————————- x100
cost of investment
6
Q
limitations of financial information
A
whether projections are true, accurate
what data is important
7
Q
what’s does gross profit mean
A
Gross profit is the money a business makes from sales after subtracting the direct costs of producing the goods or services sold.
8
Q
what does net profit mean
A
Net profit is the total income a business retains after deducting all expenses, taxes, and costs from its revenue.
