BSG Quiz 2 | Questions and Verified Solutions Latest Update

BSG Quiz 2 | Questions and Verified Solutions Latest Update Profitability Measures - what are a company's three types of profit margins? 1. Gross Profit Margin 2. Operating Profit Margin 3. Net Profit Margin Gross Profit (defined) net sales - cost of goods sold Gross Profit Margin (equation) Gross profit/net sales revenue x 100 ((net sales revenues - cost of goods sold)/net sales revenue)) In BSG, the cost of goods sold always equals the total production costs of all branded and private label pairs sold, plus shipping costs, tariffs, and exchange rate cost adjustments. What does a company's gross profit margin represent? The gross profit margin represents the dollars available to pay marketing costs, administrative expenses, interest costs, taxes, and yield a profit. Operating Profit (defined) Net revenue - cost of goods - all other operating expenses. (where all other operating expenses for an athletic footwear company equals the costs of warehouse operations + marketing costs + administrative expenses) Operating Profit Margin (equation) Operating profit/net sales revenue x 100 What does operating profit margin represent? The operating profit margin represents the dollars ava