Vol. 3 Income Statement Ratios Flashcards
1
Q
Net profit margin [calculation]
A
net profit margin is also called profit margin
net profit margin = net income / revenue
2
Q
Net profit margin [description]
A
measures the amount of income that a company was able to generate for each dollar of revenue
3
Q
Gross profit margin [calculation]
A
gross profit margin = gross profit / revenue
4
Q
Gross profit margin [description]
A
measures the amount of gross profit that a company generated for each dollar of revenue
5
Q
Operating profit margin [description]
A
profit from operations divided by revenue
6
Q
Pretax margin [description]
A
profit before tax divided by revenue
