What is the formula for calculating gross profit margin?

The formula for calculating gross profit margin is: Gross Profit Margin = (Gross Profit / Net Sales) x 100 Where: - Gross Profit is the difference between revenue and the cost of goods sold - Net Sales is the total revenue generated from sales after deducting any discounts, returns, and allowances The gross profit margin is a key financial metric that measures the profitability of a company's core business activities. It represents the percentage of each dollar of revenue that is left over after accounting for the cost of goods sold. A higher gross profit margin indicates that a company is able to generate more profits from its sales, while a lower margin may indicate inefficiencies in production or pricing. It is important for investors and analysts to monitor gross profit margin to assess a company's financial health and performance.