Enter the total gross profit and total net sales into the calculator to determine the gross profit rate.
Gross Profit Rate Formula
The following formula is used to calculate a gross profit rate.
GPR = GP / S *100
- Where GPR is the gross profit rate (%)
- GP is the gross profit ($)
- S is the total sales ($)
Gross Profit Rate Definition
A gross profit rate is a measure of the ratio of gross profit to total sales displayed as a percentage.
Gross Profit Rate Example
How to calculate gross profit ratio?
- First, determine the gross profit.
Calculate or measure the total gross profit of the business being analyzed.
- Next, determine the total net sales.
Determine the total net sales during the same time period.
- Finally, calculate the gross profit rate.
Plug the values from step 1 and 2 into the calculator to determine the gross profit rate (%).
A gross profit rate, also known as gross profit ratio, is a ratio of the total gross profit to the total sales.
A gross profit is the total profit after expenses have been paid.