Service sector companies will never report gross margin on an income statement.

Name: Service sector companies will never report gross margin on an income statement.
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Question

Quizplus · Accepted Answer

Gross margin is a measure of profitability that is calculated by dividing gross profit by net sales. Service sector companies do not have physical products to sell, so they do not have gross profit. Therefore, they cannot report gross margin on an income statement.

Service Sector Companies Will Never Report Gross Margin on an Income