If revenue is 200,000 and COGS is 120,000, what is gross margin percent?

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Multiple Choice

If revenue is 200,000 and COGS is 120,000, what is gross margin percent?

Explanation:
Gross margin percentage shows how much of each dollar of revenue remains after covering COGS. It is calculated as (revenue − COGS) ÷ revenue, expressed as a percent. Here, revenue is 200,000 and COGS is 120,000, so gross profit is 80,000. Dividing by 200,000 gives 0.40, or 40%. So the correct figure is 40%. The other options would imply different gross profits (60,000, 120,000, or 100,000) that don’t match the given numbers.

Gross margin percentage shows how much of each dollar of revenue remains after covering COGS. It is calculated as (revenue − COGS) ÷ revenue, expressed as a percent. Here, revenue is 200,000 and COGS is 120,000, so gross profit is 80,000. Dividing by 200,000 gives 0.40, or 40%. So the correct figure is 40%. The other options would imply different gross profits (60,000, 120,000, or 100,000) that don’t match the given numbers.

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