A company has sales of $695,000 and cost of goods sold of $278,000. Its gross profit equals:
$417,000, $695,000, $278,000, $973,00

Solution: 

The gross profit margin is the gross profit over the revenue. The gross profit margin helps in measuring a company's efficiency in production over a period of time.

While the gross profit is the money, the gross profit margin is the percentage.

Gross profit = total cost of goods - cost of goods sold

Given, total cost of goods = $695,000

Cost of goods sold = $278,000

Therefore, Gross profit = $695,000 - $278,000

Gross profit = $417,000

% Gross profit margin = (Gross profit/total cost of goods) × 100

% Gross profit margin = ( $417,000 / $695,000) × 100 = 60%

Therefore, the gross profit is $417,000.

A company has sales of $695,000 and cost of goods sold of $278,000. Its gross profit equals:

Summary:

A company having sales of $695,000 and cost of goods sold of $278,000, its gross profit equals to $417,000 (60%).