Taxes and Business Strategy
Gross profit margin is a financial metric that indicates the percentage of revenue that exceeds the cost of goods sold (COGS). It is a crucial indicator of a company's financial health and operational efficiency, providing insights into how well a company can produce and sell its products relative to its costs. Understanding gross profit margin helps in analyzing pricing strategies and cost management, especially in scenarios like installment sales and deferred revenue where timing and recognition of revenue play significant roles.
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