Do not factor in taxes, interest or general business expenses. These are not accounted for in gross profit margin, but they are later used to figure out net income derived from the business as a whole. If you want to figure out the profitability of several products, you can separate the total revenue and the total cost of goods sold for each product and find individual gross profit margins.
For example, if you made $200 selling 100 cans of soda and the cost of the goods sold was $100, then your gross profit would be $100.
For example, divide $100 by $100 and the figure is 1. If you multiply it by 100, you get a gross profit percentage of 100 percent.
In our example, the gross profit margin is $1. 00 divided by $1. 00, so we get a profit margin percentage of 100 percent.
