Net Profit Ratio Calculator
The net profit ratio can be explained as the ratio of net profit i.e, after tax to net sales. We can find net profit ratio when we know the net profit and net sales.Formula to calculate net profit ratio is given below:Example:
In 2013, company ABC had a total sale of $200,000, sales return of $15,000 and a net profit of $25,000. Calculate its net profit ratio.Solution:
Total Sales = $200,000
Sales Return = $15,000
Net Profit = $25,000
We know the formula to calculate net profit ratio = Net Profit / Net Sales * 100
We can know net sales by subtracting total sales with sales return = [$200,000 - $15,000] = $185,000
Inserting the values into the formula = 25,000/185000 * 100
= 0.135 * 100
= 13.5%Hence, the net profit ratio of ABC company is found to be = 13.5%
In the below online net profit ratio calculator, enter the net profit and net sales in the respective input boxes and then click calculate button to find the answer.
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