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Profit margin |
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Profit marginThe difference between what it costs to produce a product or service and the selling price.Profit marginOperating profit as a percentage of sales (or turnover). To calculate profit margin, multiply operating profit by 100, and divide the result by turnover.Example: Company X made an operating profit of £500m on a turnover of £3,000m. Profit margin was therefore (500 x 100) / 3000= 16.66%Profit margin tells you about the underlying profitability of a company's trading activities, not whether it is actually making money for shareholders. Note that it is calculated before taking account of interest charges or tax.Profit marginIndicator of profitability. The ratio of earnings available to stockholders to net sales. Determined by dividing net income by revenue for the same 12-month period. Result is shown as a percentage. Also known as net profit margin.Profit margin Similar MatchesExcess profitExcess profitProfit of a firm over and above what provides its owners with a normal (market equilibrium) return to capital. Zero profitZero profitA situation in which profit in an industry is zero, usually as a result of free entry and exit. It may, if firms are not identical, refer only to the marginal firm. And it always means zero excess profit, not that all returns to capital invested in the industry are zero. Profit TableProfit TableA table of results of a particular strategy at some point in time. This is usually a tabular compilation of the data drawn on a profit graph. See also Profit Graph. Net profit marginNet profit marginNet income divided by sales; the amount of each sales dollar left over after all expenses have been paid. Non profit endowmentNon profit endowmentThis type of endowment guarantees repayment of the loan. There are no annual or final bonuses and you generally have no chance of a cash surplus on maturity. Essentially, there is no benefit other than life cover which is eaqual to the value of the mortgage you have ttaken out. This is seen as an inefficient method of saving the money to pay back and is therefore rarely recommended as a method of repaying a mortgage. Further Suggestionsprofit before taxAccumulated profits tax Directly Unproductive Profit-Seeking Activities Profit taking Risk adjusted profitability Profit Graph Profit forecast Operating profit margin unitised with profits Profit Range Book profit paper profit Profitability ratios profit and loss statement (P&L) net profit before tax (pre tax profit) Full with profit endowment Not for profit Profit maximizing Gross profit margin net profit Profit center Profit profit taking Realized profit (or loss) profits warning |
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