How To Calculate Gross Profit?

#Accounting

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Gross Profit = Revenue - Cost of Goods Sold (COGS)

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Identify total revenue from sales

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Identify total COGS

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Subtract COGS from revenue

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Gross Profit = Total Revenue - Total COGS

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Gross Profit Margin = (Gross Profit / Revenue) × 100

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Example: Revenue = 10,000 and COGS = 6,000

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Gross Profit = 10,000 - 6,000 = 4,000

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Gross Profit Margin = (4,000 / 10,000) × 100 = 40%

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