If a business's net sales are $200,000 while cost of goods sold totals $140,000, its gross margin is 60 percent of sales.

Name: If a business's net sales are $200,000 while cost of goods sold totals $140,000, its gross margin is 60 percent of sales.
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The gross margin is calculated as (Net Sales - Cost of Goods Sold) / Net Sales. In this case, it would be ($200,000 - $140,000) / $200,000 = $60,000 / $200,000 = 0.3 or 30%.

If a Business's Net Sales Are $200,000 While Cost of Goods