Profit Margin

The profit margin shows the relationship between net income (profit) and sales. This interactive tutorial explains the concept by walking you through the calculations, including where to find the numbers on the income statement. Continue reading

Gross Profit Ratio

The gross profit ratio indicates how much of each sales dollar is available to meet expenses and profits after merely paying for the goods that were sold. This interactive tutorial explains the gross profit ratio by walking you through the steps, including where Sales and Cost of Goods Sold are on the Income Statement. It lets you use your own numbers — great for checking homework answers! Continue reading

Income Statement, Multi-Step

Learn about the structure and contents of a multi-step income statement by examining one for the fictitious company Bogus Manufacturing, Inc. Continue reading