Which ratio measures the portion of net sales that is gross profit?
A) Gross margin ratio
B) Net sales ratio
C) Gross profit ratio
D) Gross margin ratio and gross profit ratio
E) All of the above

Question

Quizplus · Accepted Answer

The gross margin ratio and the gross profit ratio both measure the portion of net sales that is gross profit. They are essentially different names for the same financial metric, indicating how much of the sales revenue is retained after accounting for the cost of goods sold.

Which Ratio Measures the Portion of Net Sales That Is