In managerial accounting, two types of margins are generally calculated. Gross margin, revenue less cost of goods sold, is used when preparing a traditional income statement. Contribution margin, ...

Learn about gross, operating, and net profit margins, how each is calculated, and how businesses and investors can use them to analyze a company’s profitability.

Your business's income statement is a long string of pluses and minuses. You start with your sales revenue, subtract costs of goods sold to get gross profit, then subtract expenses to get net profit.

Gross profit margin is a ratio that measures the percentage of revenue left after subtracting production costs. By indicating the profitability of a company's core business operations, gross profit ...

Companies need to generate profit to stay afloat. They do this by producing goods or services and selling them for more than it costs to produce them. This difference is the company’s gross profit: ...

Ignore your financial statement, and you effectively ignore the health of your company. A good manager should be able to deftly use the gross margin to understand which areas of the company are ...

Profit is an essential component of any business operation. It indicates the business's financial success and allows owners to continue running their companies. Understanding how to calculate profit ...

For companies that sell more than one product, it is helpful to calculate how much each individual product contributes to the overall company's sales and profits. To do that, we calculate the margin ...

I’ve mentioned before that your gross profit is your real revenue. It is your true top line. Revenue is vanity. It is what we like to brag about at cocktail parties. Gross profit is the economic ...

One of the most important financial concepts you will need to learn in running your new business is the computation of gross profit. And the tool that you use to maintain gross profit is markup. The ...