Question

Compute Gross Profit Ratio from the following information:
Cost of Revenue from Operations (Cost of Goods Sold) ₹5,40,000; Revenue from Operations (Net Sales) ₹6,00,000.

Answer 1

Gross Profit = Revenue from Operations – Cost of Revenue from Operations
= 6,00,000 – 5,40,000
= Rs 60,000
$\begin{array}{l}\text{Gross Profit Ratio =}\frac{\text{Gross Profit}}{\text{Revenue from Operations}}\times \text{100}\\ =\frac{60,000}{6,00,000}\times \text{100}\\ \text{= 10\%}\end{array}$