Gross Profit expressed as a percentage of Revenue. A higher gross margin means the business keeps more money from each sale before covering operating costs. Formula: (Revenue − COGS) ÷ Revenue × 100.
How to calculate it
Gross margin = (Revenue − COGS) ÷ Revenue × 100. It shows the portion left after direct costs, before overhead. Compare within your industry and across consistent periods.
($750,000 − $450,000) ÷ $750,000 = 40% gross margin.
Where this connects to Impresa
You may encounter this concept when reviewing Financial Health. Start with the underlying inputs and check the applicable reporting period before interpreting the result.
Read the Financial Health guideDefinitions here explain the concept. Accounting treatments, formulas, and industry comparisons may vary. Use your own records and qualified advice for material decisions.