# A company had $7,000,000 in net income for the year. Its net sales were$15,200,000 for the same...

## Question:

A company had $7,000,000 in net income for the year. Its net sales were$15,200,000 for the same period.

Calculate its profit margin.

## Gross Profit Margin:

Gross Profit Margin is calculated by dividing the net income by the net sales for the year. Net Income is computed by Sales deducted the Cost of Sales and Operating and Non operating expense. Gross Profit Margin ratio is used to calculate the percentage of how much profit are being generated or produced from the current revenue of the company.

Net Income 7,000,000
Divided by: Net Sales 15,200,000
Gross Profit Margin Ratio 46%