Computation of
Gross Profit
Entrepreneurship
Terms to remember:
Profit- is the gross income. The amount of gross profit provides
information to he entrepreneur about revenue earned from sales.
Cost - refers to the purchase price of the product including of the product
including the total outlay required in producing it.
Compute the Gross Profit
In computing for the Gross Profit, we need the following formula:
NET SALES – COST = GROSS PROFIT
In computing for the Gross Profit Rate, we need the following formula:
Example:
Rodrigo is engaged in a buy and sell business of perfumes. He
bought 10 boxes of perfumes. Each box costs 12,000.00 and
contains a dozen of perfume bottles. He is planning to sell one
perfume bottle at P1,500. Find for the gross profit rate of Rodrigo
upon selling all the boxes of perfumes.
Operating Profit Margin
- Is the excess of gross profit from operating expenses
- The operating profit margin is the second level of revenue in the income
statement.
Operating Profit Margin
Formula:
Gross Profit – Operating Expenses = Operating Profit Margin
Formula in getting the Operating Profit Margin Rate:
Example:
With the current situation of Rodrigo, he needed to rent for a place to
display all the perfumes that he bought. The payment of the rent of
Rodrigo is at P 10,000. Find for the Operating Profit Margin and
Operating Profit Margin Rate of Rodrigo.
Net Profit Margin
- The Income statement is the net profit margin & the third level
in the revenue.
Net Profit Margin
Formula in getting the Net Profit Margin:
Operating Profit Margin + Interest Income – Income Tax – Interest Expense = Net Profit
Margin
Formula in getting for the Net Profit Margin Rate:
Net Profit Margin
Rodrigo being a businessman already, needed to pay for an income
tax of P6,500.00 as mandated by the government. Find for
Rodrigo’s Net Profit Margin and Net Profit Margin Rate.
SOLVE!
Annie bought one dozen smartphones for P200,000.00. She sold each unit at a price of
P19,000.00.
With that being said, Annie has also spent at least P6,000 by renting a place to sell these
android phones. Since Annie is a business owner she needed to pay the tax she is entitled to
pay. Upon asking her tax payment is at P3,500.00.
Find for:
1.Gross Profit Rate
2.Operating Margin Rate
3.Net Profit Margin Rate
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COMPARISON
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Section 1 Title Section 2 Title
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magna sed pulvinar ultricies, purus lectus malesuada magna sed pulvinar ultricies, purus lectus malesuada
libero. libero.
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tellus.
tellus.
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50000
CHART
SLIDE 40000
30000
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do eiusmod tempor 10000
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0
20XX 20XX 20XX 20XX 20XX
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TABLE 20XX 20XX 20XX
SLIDE
Category 0 400,000 1,600,000
Category 500,000 4,000,000 16,000,000
Category 75 80 90
Category 5,625,000 48,000,000 216,000,000
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Category 0 0 0
dolor sit amet,
consectetuer adipiscing Category 5,625,000 48,000,000 216,000,000
elit, sed Category 1,687,500 9,600,000 21,600,000
do eiusmod tempor Category 562,500 2,400,000 10,800,000
incididunt ut labore.
Category 281,250 2,400,000 4,320,000
Category 7,593,750 52,800,000 187,920,000
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VIDEO SLIDE
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THANK
YOU!
Alexander
Martensson
Phone
678-555-0128
Email
[email protected]
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