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Gross profit margin |
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Gross profit marginGross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold.Gross profit margin Similar MatchesProfit and loss statement (P&L)Profit and loss statement (P&L)A set of accounts, usually prepared annually, which depict a company's trading performance and are normally read in conjunction with the balance sheet and cash flow data. The profit and loss account can broadly be shown as follows:Turnover (sales) less manufacturing costs (or cost of sales if for example a retailing company) = gross profit or lossGross profit plus any non-trading income less operating costs = operating profit Operating profit less interest payments on bank loans or loan stock = profit before tax (pre tax profit)Pre-tax profit, less tax = net profit after taxPart of the net profit after tax may be used to pay a dividend with the balance being retained within the business for future investment. Profitability ratiosProfitability ratiosRatios that focus on how well a firm is performing. Profit margins measure performance with relation to sales. Rate of return ratios measure performance relative to some measure of size of the investment. Trading profitTrading profitThe profit earned on short-term trades of securities held for less than one year, subject to tax at normal income tax rates. Profit sharing planProfit sharing planAn incentive system providing that employees share in company profits through a cash fund or a deferred plan used to buy stock or bonds. Pre tax profitPre tax profitSee: 'profit before tax'. Further SuggestionsProfit marginNon profit endowment Profit forecast Profit center net profit before tax (pre tax profit) profit margin Pretax earnings or profits Profit taking Excess profit paper profit Windfall profit Unitised with profit endowment Operating profit margin Accumulated profits tax Profit Profit Graph profits warning Profit Range net profit Book profit Profit margin profit before tax Net profit margin Risk adjusted profitability Not for profit |
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