The gross margin percentage is equal to:
A) (Net operating income + Selling and administrative expenses)/Sales
B) Net operating income/Sales
C) Cost of goods sold/Sales
D) Cost of goods sold/Net income

Question

Quizplus · Accepted Answer

Gross margin percentage is calculated by adding net operating income and selling and administrative expenses together, then dividing by sales. This formula accounts for the total revenue minus the cost of goods sold and operating expenses, providing a percentage that reflects the efficiency of a company in managing its direct costs and overhead in relation to its sales revenue.

The Gross Margin Percentage Is Equal To