The Bottom Line Gross profit and gross profit margin both provide good indications of a company's profitability based on their sales and costs of goods sold. However, the ratios are not a ...

However, it should be noted that economic theory offers no reason as to why profit margins should mean revert. It is the return on capital, not the return on sales, that ‘should’ mean revert.

Either method of calculation delivers the operating income figure that is divided by revenue to bring in the operating margin. The difference between the two is the approach on profit: Operating ...

Net Profit Margin = Net profit/Sales * 100. In simple terms, net profit is the amount a company retains after deducting all costs, interest, depreciation, taxes and other expenses. In fact ...

Gross profit and gross margin show the profitability ... It can also be called net sales because it can include discounts and deductions from return- ed merchandise. Revenue is typically called ...