Why should I choose AnalystNotes?
Simply put: AnalystNotes offers the best value and the best product available to help you pass your exams.
Basic Question 8 of 11
What is another term for gross profit margin?
B. Earnings before interest and taxes
C. Income before taxes
D. Gross margin
A. Operating profit
B. Earnings before interest and taxes
C. Income before taxes
D. Gross margin
User Contributed Comments 10
| User | Comment |
|---|---|
| Alfa1 | Gross profit= gross margin |
| vincenthuang | Gross margin= Gross profit/Sales So the answer is wrong. I think operating profit is the answer |
| tony1973 | Operating profit is gross profit minus sales, general and administrative expenses (SG&A). It is also called EBIT. |
| Gina | Gross Profit= Net Sales - COGS Operating Profit=EBIT = [NI+InterestExp+IncomeTax] |
| db28luke | Gross profit does not equal gross profit margin. |
| yanpz | answer is correct |
| danlan | EBIT=operating profit=gross profit-operating expense Operating expense includes admin expenses, ... gross profit=sales-COGS |
| sarath | The two terms can be used interchangeably.. |
| achu | "Gross profit does not equal gross profit margin." That's true, but Gross margin and Gross Profit Margin are synonymous. One could say the (profit) is implied. |
| leon121 | Could this really be a CFA question??? It's too basic................... |
I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
evaluate a company's financial performance using common-size income statements and financial ratios based on the income statement
CFA® 2024 Level I Curriculum, Volume 2, Module 2.