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 ($) • S is the total sales ($)

To calculate a gross profit rate, divide the gross profit by the total sales, then multiply by 100.

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?

1. First, determine the gross profit.

Calculate or measure the total gross profit of the business being analyzed.

2. Next, determine the total net sales.

Determine the total net sales during the same time period.

3. Finally, calculate the gross profit rate.

Plug the values from steps 1 and 2 into the calculator to determine the gross profit rate (%).

FAQ

What is a 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.

What is gross profit?

A gross profit is a total profit after expenses have been paid.