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# Gross Profit Percentage

Gross profit percentage tells us how much of sales income is gross profit. Gross profit is the sales amount of the cost of particular items that was sold. Profit will be gained whenever the selling price of one thing is greater than cost price.

Gross profit percentage is one of the way to evaluate financial performance of a person or company. It helps to see what percentage of their earning after costs is profit.

 Related Calculators Calculating Profit Percentage off Calculation of Percentage Difference Percentage

## Gross Profit Percentage Formula

Formula to find gross profit percentage:

Gross profit is calculated simply by subtracting the cost of goods from the net sales price.

Gross Profit = Net Sales Price - Cost of Goods.

## How to Calculate Gross Profit Percentage

To calculate Gross profit percentage, divide the Gross profit by the selling price in each category.To calculate each category's gross profit percentage, divide the average gross profit by the average selling price.

Steps for Calculating Gross Profit Percentage:

Step 1:
Figure out gross profit for each category of product.

Step 2:
Divide gross profit by selling price.

### Solved Examples

Question 1: If the cost of a fan is 3.30 dollar and sold at 5.90 dollar. Find the gross profit percentage.

Solution:

Given
Cost Price of a fan = 3.30

and selling price = 5.90

Step 1: Find Gross Profit

Gross Profit  = Sell Price - Cost Price

= 5.90 - 3.30

= 2.60

Step 2:

Gross Profit Percentage = $\frac{Gross Profit}{Selling Price}$

= $\frac{2.60}{5.90}$

= 0.44  or

= 0.44 * 100

= 44%

Question 2: Calculate gross profit ratio from the following particulars:

 Particulars Sales Opening Stock Purchases Closing Stock $1,66,000 50,000 90,000 20,000 Solution: Cost of goods sold = Opening stock + Purchases - Closing stock = 50,000 + 90,000 - 20,000 = 1,20,000 Gross profit = 1,66,000 - 1,20,000 = 46,000 Gross profit ratio =$\frac{Gross   Profit}{selling   Price}$x 100 Gross profit ratio =$\frac{46,000}{1,66,000}$x 100 = 27.71 % Question 3: Stefen sold some particulars at 10,000 dollars. The cost price of that particulars is 5,000 dollars. Find the gross profit percentage. Solution: Given Cost Price of particulars = 5,000 and selling price = 10,000 Step 1: Find Gross Profit Gross Profit = Sell Price - Cost Price = 10,000 - 5,000 = 5,000 Step 2: Gross Profit Percentage =$\frac{Gross  Profit}{Selling  Price}$=$\frac{5000}{10000}$= 0.50 or = 0.50 * 100 = 50 % Question 4: Janina buy a car in 5,000 dollar and she sold it at 11,500 dollar. Find the gross profit percentage. Solution: Given Cost Price of a car = 5000 and selling price = 11500 Step 1: Find Gross Profit Gross Profit = Sell Price - Cost Price = 11500 - 5000 = 6500 Step 2: Gross Profit Percentage =$\frac{Gross  Profit}{Selling  Price}$=$\frac{6500}{11500}\$

= 0.56  or

= 0.56 * 100

= 56%

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