Chapter10: Inventory
Section: Chapter Questions
Problem 1Q: What is meant by the term gross margin?
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Question
What is net profit margin?
Expert Solution
Step 1
The margin of net profit is equal to the amount of income produced by the net sales or gains. For a corporation or market segment, the net profit margin is the profit/revenue ratio.
Step 2
Usually, the net profit margin is calculated as a percentage, but it can also be shown decimal. The margin for net profit shows how much of every dollar of profits a business receives turns into profit.
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