Question

Find out Gross Profit Ratio from the following:
Revenue from Operations = ₹ 1,00,000
Cost of Revenue from Operations = ₹ 65,000

Hint:

Gross Profit Ratio measures profitability from core operations. Always first calculate Gross Profit, then divide it by Revenue and multiply by 100.

Answer 1

Step 1: Calculate Gross Profit
\[ \text{Gross Profit} = \text{Revenue from Operations} - \text{Cost of Revenue from Operations} \] \[ = 1,00,000 - 65,000 \] \[ = ₹ 35,000 \]
Step 2: Calculate Gross Profit Ratio
\[ \text{Gross Profit Ratio} = \frac{\text{Gross Profit}}{\text{Revenue from Operations}} \times 100 \] \[ = \frac{35,000}{1,00,000} \times 100 \] \[ = 35% \] Gross Profit Ratio = 35%