Which of the following ratios measures the percentage of sales revenue available to pay operating costs and to provide profits after paying for inventory?

Question

Quizplus · Accepted Answer

The gross margin ratio measures the percentage of sales revenue that is available after paying for the cost of goods sold (inventory costs), which can then be used to pay operating expenses and to generate profit. It is calculated by subtracting the cost of goods sold from sales revenue and then dividing by sales revenue.

Which of the Following Ratios Measures the Percentage of Sales