If sales revenue is $600 000 and cost of sales is $450 000,the gross profit margin is:
A) 75%
B) 25%
C) 33%
D) 67%

Question

Quizplus · Accepted Answer

Gross profit margin is calculated by subtracting cost of sales from sales revenue and then dividing the result by sales revenue.

Gross Profit Margin = (Sales Revenue - Cost of Sales) / Sales Revenue

Plugging in the given values, we get

Gross Profit Margin = (600 000 - 450 000) / 600 000 
                    = 150 000 / 600 000 
                    = 0.25 or 25%

Therefore, the correct answer is B) 25%.

If Sales Revenue Is $600 000 and Cost of Sales