Hello, I needed help in finding out how to find the net margin $. this is for a sales class. Also, there is a chart I need to fill out. How do I find out the gross margin? What are the calculations?

 

Here is the proforma for the computation that applies both for Net Margin and Gross Margin

Revenue / Sales

Less: Cost of Goods Sold

GROSS MARGIN

Less: Operating Expenses

Less: Other Expenses

Less: Interest and Taxes*

NET MARGIN

*If the problem doesn't give you any provision for interest and taxes, you don't have to worry about it just ignore it in the formula for the computation of your net margin.

So if we are to do it one by one:

GROSS MARGIN = Net Sales - Cost of Goods Sold

NET MARGIN = Revenue - Cost of goods sold - Expenses (Operating and Other) - Interest and Taxes (whenever applicable, ignore if not)

Step-by-step explanation

Here's an example so that it will be much easier for you to understand:

Revenue - $1,000 ; Cost of goods sold - $500 ; Expenses - $20

Revenue $1,000

Less: COGS $500

GROSS MARGIN $500

Less: Expenses $20

NET MARGIN $480