The Net Profit Margin Formula The net profit margin formula may appear daunting but is in fact very straightforward to use. (R-COGS-E-I-T) x 1 WHERE: R = revenue COGS the cost of goods sold E operating and other expenses I= interest T = taxes Once we have plugged some numbers into this formula, the picture becomes much clearer. Also note that multiplying the entire result by one hundred will give us a decimal value that can (and often is) expressed as a percentage of total revenue. For our example, let's use the values from the table below. Revenue COGS ABC Corp x 100 Operating and other expenses Interest Taxes Click or tap to enlarge $72,300 $23,600 $21,000 $900 $2,900 With this information plugged into the formula, we can calculate the net profit margin for our example ABC Corp, as shown below. 72,300 - 23,600-21,000-900-29,000 72,300 ⁰⁰) x 100
The Net Profit Margin Formula The net profit margin formula may appear daunting but is in fact very straightforward to use. (R-COGS-E-I-T) x 1 WHERE: R = revenue COGS the cost of goods sold E operating and other expenses I= interest T = taxes Once we have plugged some numbers into this formula, the picture becomes much clearer. Also note that multiplying the entire result by one hundred will give us a decimal value that can (and often is) expressed as a percentage of total revenue. For our example, let's use the values from the table below. Revenue COGS ABC Corp x 100 Operating and other expenses Interest Taxes Click or tap to enlarge $72,300 $23,600 $21,000 $900 $2,900 With this information plugged into the formula, we can calculate the net profit margin for our example ABC Corp, as shown below. 72,300 - 23,600-21,000-900-29,000 72,300 ⁰⁰) x 100
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter8: Cost Analysis
Section: Chapter Questions
Problem 9E
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explain the photo regarding the net profit margin and give insights about it. also, provide a graph for that and explain how you made it. use your own words
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